Startup Professionals Musings

JUNE 11, 2014

Being the leader doesn’t mean more equity, nor does it mean the leader will necessarily be CEO. The rest can come from early hires (with stock options to assure commitment), equity investors, or even strategic partners. It just means that the cofounders trust one of their own and are willing to follow.

Technical Cofounder 245

Technical Cofounder Cofounder Advisory Board Startup 245

Both Sides of the Table

MAY 27, 2013

Understanding where your VC partner sits in their respective fund and where their fund is in the cycle of its investment lifecycle will help you understand your VCs behavior. And you can often throw in a separate action like approving stock-option grants, getting approval for CAPEX spend, discussing fund raising timing – whatever.

Advisory Board 365

Advisory Board CTO Hire Fractional CTO Los Angeles 365

Startup Professionals Musings

MAY 8, 2022

Old co-workers or new friends with complementary skills usually make the best partners. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones. The founder’s title and role dilemma.

Founder 325

Founder Hockey Stick Cofounder Liquidity Event 325

Austin Startup

JULY 15, 2019

You will work closely with Joshua Baer, Gordon Daugherty, Bryan Chambers, the Ventures Team, limited partners, external venture capitalists, lawyers, accountants and startup CEO’s to review legal agreements, perform our diligence checklist, and make sure transactions close in a timely manner. Do you catch mistakes that other people miss?

Texas 56

Texas Technical Review Silicon Valley Venture Capital 56

www.inc.com

SEPTEMBER 24, 2011

Should You Share Equity with Consultants? To grow his cash-strapped start-up, Parker ended up sharing equity -- not only with employees, but also with consultants and vendors. Parker found that equity as compensation helped build loyalty to his company -- even among consultants. But sharing equity can have pitfalls, too.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

Steve Blank

MARCH 16, 2016

Risk capital takes equity (stock ownership) in your company instead of debt (loans) in exchange for cash. Founders can now access the largest pool of risk capital that ever existed –in the form of Private Equity (Angel Investors, family offices , Venture Capitalists (VC’s) and Hedge Funds.). The Bad News.

Liquidity Event 120

Liquidity Event Founder Liquidation Preference Private Equity 120

Startup Professionals Musings

SEPTEMBER 13, 2015

Being the leader doesn’t mean more equity, nor does it mean the leader will necessarily be CEO. The rest can come from early hires (with stock options to assure commitment), equity investors, or even strategic partners. It just means that the cofounders trust one of their own and are willing to follow.

Technical Cofounder 120

Technical Cofounder Cofounder Advisory Board Stock Options 120

Startup Professionals Musings

APRIL 10, 2016

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment. Calculate employee stock option values and vesting times, as well as salary. When did this effort really start, including pivots?

Sweat Equity 120

Sweat Equity Burn Rate Technical Review Intellectual Property 120

Startup Professionals Musings

APRIL 8, 2015

Most founders like to talk about their many months or years of sweat-equity , but cash invested is a stronger commitment. Calculate employee stock option values and vesting times, as well as salary. When did this effort really start, including pivots?

Technical Review 120

Technical Review Due Diligence Sweat Equity Burn Rate 120

Both Sides of the Table

JANUARY 21, 2010

You never got around to agreeing exact equity splits but you had many conversations about it. Forget to get around to setting up that Employee Stock Option Plan and want to be able to give the early guys their options at a low strike price? Focus on the partner you would be working with.

Southern California 318

Southern California Silicon Valley IP Stock Options 318

The Next Web

OCTOBER 8, 2015

As a rule, entrepreneurs are very protective of their equity, and try to keep 100 percent ownership for themselves. employees, partners) are appropriately motivated to help you succeed. lucrative sales commission plan, profit share plan), and sometimes that comes in the form of equity or equity linked incentives (e.g.,

Equity 60

Equity Employee Warrant Stock Options 60

Berkonomics

JANUARY 25, 2024

And some will willingly work for stock options, an amount to be negotiated based upon time spent and stage of corporate development. The one warning: avoid those looking to become partners, asking for larger portions of equity than, say, 5% when they contribute no cash to the enterprise.

SBA 62

SBA Warrant Stock Options Vesting 62

Feld Thoughts

OCTOBER 8, 2013

My partner Dave and I took the number, made a list of all employees, and figured out how much we were going to give each of them. Even better, consider using equity compensation as the bonus. Figure out an equation for converting the bonus amount (in current cash terms) to stock option awards.

Stock Options 146

Stock Options Technical Review Leadership Equity 146

Startup Professionals Musings

AUGUST 10, 2019

Old co-workers or new friends with complementary skills usually make the best partners. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones. The founder’s title and role dilemma.

Hockey Stick 243

Hockey Stick Cofounder Liquidity Event Startup 243

www.drowningamerican.com

JUNE 22, 2012

Next → How we Hire for Sweat Equity (Part 2)… Posted on April 7, 2011 by Travis Biziorek. The first time we hired partners for Kibin was way back in late 2009. I’m not FaceBook or Twitter and have a s**t-ton of potentially imminent IPO stock options to offer someone. equity in the company.

Sweat Equity 40

Sweat Equity Equity Hiring Technical Review 40

Both Sides of the Table

APRIL 19, 2011

Called Tim Spicer (c-companies partner) and he told him matt, they only want one thing, more warrant coverage!!! Mark: 10% warrant coverage is like stock options. Icing is the warrant for banks – stock they can buy in future but don’t have to buy so they make their $$ later in the future. And he said ok got it.

Acquisition 304

Acquisition Warrant Customer Term Sheet 304

crowdSPRING Blog

NOVEMBER 7, 2014

Startup Equity and Stock Options: What’s It Worth to You? The @crowdSPRING community partners with US State Dept for Social Impact | Justmeans – crowdspring.co/1ux55RH. A Counterintuitive System for Startup Compensation – crowdspring.co/1zRImmt. – crowdspring.co/1sSpg62. 10baTD3.

Social Media 99

Social Media Small Business Design Media 99

YoungUpstarts

FEBRUARY 11, 2020

Why do you think there are so few women in private equity, and what can be done to change that? When I became a managing partner, aside from directing our strategy on where to invest, I also helped recruit board positions and management teams. It starts at the top. You are the first line of defense in a healthy ascent.

Switzerland 264

Switzerland Private Equity Stock Options Equity 264

Startup Professionals Musings

DECEMBER 14, 2014

Old co-workers or new friends with complementary skills usually make the best partners. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones. The Founder’s title and role dilemma.

Hockey Stick 268

Hockey Stick Cofounder Entrepreneur Liquidity Event 268

Both Sides of the Table

MAY 19, 2018

Your historical trading information including financials and a “customer file” which shows the history of your transactions so that investors can run “cohort” analyses Customer reference, personal references, key team members, compensation, cap table, stock option plan, etc. Some people find this elitist?—?I

Cap Table 336

Cap Table Due Diligence Forecast Churn Rate 336

Startup Professionals Musings

AUGUST 19, 2017

Old co-workers or new friends with complementary skills usually make the best partners. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones. The founder’s title and role dilemma.

Hockey Stick 144

Hockey Stick Cofounder Entrepreneur Liquidity Event 144

Both Sides of the Table

MARCH 21, 2010

I’ve heard the following so many times that it still makes me scratch my head, “if those guys are going to get rich off of our backs then we’re going to look like fools if we don’t have equity.&#. I’ve already made clear that I think raising equity from “strategic money&# is an oxymoron.

Warrant 298

Warrant Dilution Startup Stock Options 298

Startup Professionals Musings

JULY 19, 2013

Old co-workers or new friends with complementary skills usually make the best partners. You have very little money, and you don’t want to give away your equity. Giving equity is realistic, but base it on contribution and role, with vesting after time and milestones. The Founder’s title and role dilemma.

Founder 245

Founder Hockey Stick Cofounder Liquidity Event 245

Scalable Startup

AUGUST 9, 2018

There are so many Facebook/Google/Apple multi-millionaires who receive new stock options every quarter, often a few hundred thousand dollars every quarter, that feel they should put something back into the system, plus they like the idea of being an investor. They’re betting on you. To me, this is the best time to raise your seed.

Technical Cofounder 20

Technical Cofounder Silicon Valley Early Stage Cofounder 20

Startup Company Lawyer

MARCH 12, 2009

S corps are not a popular entity choice because, in addition to presenting the same challenges to tax-exempt venture fund partners as those presented by LLCs, S corps are limited to one class of stock (meaning no preferred stock financings) and 100 stockholders. Businesses that plan to use equity incentives (e.g.

LLC 61

LLC Stock Options Preferred Stock Stock 61

Berkonomics

DECEMBER 7, 2017

And some will willingly work for stock options, an amount to be negotiated based upon time spent and stage of corporate development. The one warning: avoid those looking to become partners, asking for larger portions of equity than, say, 5% when they contribute no cash to the enterprise.

Warrant 97

Warrant Stock Options Vesting Equity 97

Up and Running

SEPTEMBER 10, 2014

Stock Option. It leads me to believe the entrepreneur avoided giving up equity as long as possible and now needs capital to get out of a financial crisis. Management Resumes and Organizational Chart. Customer References. Personal References. Social Security Numbers (for background checks). But don’t ask for a non-disclosure.

Angel Investor 159

Angel Investor Technical Review Software Review Accredited Investor 159

www.thedailymuse.com

SEPTEMBER 18, 2012

You don’t want a senior partner preparing documents for an incorporation, nor do you want a third-year lawyer negotiating with a seasoned venture capitalist for you. A junior lawyer at a small firm in a smaller city may charge $150 an hour, while senior partners in big firms in major cities have been known to charge over $1,000 an hour.

Hiring 56

Hiring LLC Intellectual Property Private Equity 56

Both Sides of the Table

AUGUST 18, 2009

To be clear – it is not about being stingy with or hoarding equity – it is about having a prenuptial agreement. I believe that it very important to spread the equity. I believe that you should have a “partner&# or 2 in the company. I believe you should treat them as partners. To the contrary.

Founder 251

Founder Cofounder Equity Stock Options 251

The Next Web

MARCH 2, 2014

Should we finance with debt or equity? This is the ultimate question to consider when weighing funding options. For us, because we chose to finance with debt, we gave up almost no equity in the company, and therefore almost no dilution of stock options. Is this someone you really want to partner with?

Liquidity Event 139

Liquidity Event Equity Finance Stock Options 139

infochachkie.com

SEPTEMBER 24, 2011

Instead of hearing from your long lost third-cousin, you will be inundated with an avalanche of ‘congratulatory’ emails, calls and letters from people who want to relieve you of the burden of your hard-earned equity round. The final straw came when I asked the latest 25-year old a simple ‘yes / no’ question related to stock options.

Equity 40

Equity Silicon Valley Cofounder PR 40

Berkonomics

NOVEMBER 23, 2023

Here is the warning: The execution of equity allocations and of a good incentive program using equity is often mismanaged, damaging the corporate capitalization structure and even affecting the outcome of subsequent investment into the company. … Equity is divided between the founders and the business begun. Here are some rules.

Equity 62

Equity Stock Options Vesting Early Stage 62

Both Sides of the Table

MAY 23, 2010

a loan) that is later converted to equity at the time of the next financing. If no financing happened then this “note&# may not be converted and thus would be senior to the equity of the company in the case of a bankruptcy or asset sale. VC’s money comes from mostly institutional investors called LPs (limited partners).

Startup 290

Startup Burn Rate Warrant Bankruptcy 290

Gust

NOVEMBER 4, 2011

In brief, a cap acts to place a limit on the conversion price of a convertible note such that investors are guaranteed a minimum number of shares for their bridge loans if the startup does a priced equity round at a high pre-money valuation – “high” meaning above the cap, which is often a heavily negotiated term. (The of MySpace, Inc.

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98

Austin Startup

SEPTEMBER 19, 2017

In other cases, they may come from your channel partners or elsewhere. As for compensation, stock options in the range of 0.1% in company equity is normal at this stage, with the higher end of the range reserved for leaders of industry who bring more to the table than connections.

Advisory Board 48

Advisory Board Sweat Equity Marketing Vertical 48

thinkspace.com

SEPTEMBER 7, 2012

How to Divide Equity to Startup Founders, Advisors, and Employees. The part that I’d like to zero in on is when you’ve got a high growth company what are some of the best practices out there to distribute equity to the founders, advisors, and employees? Equity for Founders. Equity for Employees. Bookkeeper.

Equity 62

Equity Employee Founder CTO Hire 62

Agile VC

FEBRUARY 2, 2012

My partner Rob also wondered if Facebook is the next Yahoo! , I’ll focus for now on the business itself, there’s plenty of other info on the web if you care to understand the equity ownership or financing history of Facebook and frankly this has been fairly well known for awhile. ==. or the next Google. Facebook, Inc.

IPO 100

IPO South Korea Venezuela Revenue 100