www.readwriteweb.com

DECEMBER 29, 2011

While certainly not every business needs to raise venture financing, it is the path for many high-growth technology startups. Tip 4: Really Understand Key Terms. Once you get the term sheet make sure you know how to read it. Once you have a term sheet you are happy with, don't over negotiate.

Cap Table 47

Cap Table Term Sheet Liquidation Preference Technical Review 47

www.mattbartus.com

DECEMBER 9, 2012

How to pump up your VC valuation. Let’s say you receive a term sheet for a $1 million investment at a $3 million fully diluted pre-money valuation, and you’re kind of disappointed. You have a 20% option pool, so you know this will take your ownership down from 80% to 60%, and the VC will get 25%.

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40

Scott Edward Walker

NOVEMBER 26, 2017

Indeed, this is critical in order to effectively negotiate any transaction (including a financing) – as every investment banker on Wall Street understands. As Travis Kalanick advises (in my favorite post on fundraising ): The second you have a single term sheet, you need to move *very* quickly to get a second one.

Term Sheet 63

Term Sheet San Francisco Founder Investment Bankers 63

Scott Edward Walker

AUGUST 31, 2011

Thanks, Scott Question We’re a startup based in Palo Alto, and we just received a Series A term sheet for a $725,000 investment. Which financing sources should they consider? At what valuation and on what terms? The investor is kind of insisting that we use his lawyer at a big Valley firm to represent us.

Silicon Valley 45

Silicon Valley Term Sheet Liquidation Preference Redemption 45

The Startup Lawyer

FEBRUARY 4, 2011

The following are some issues to consider and actions to take before accepting an incubator’s offer: (1) Calculate Valuation and Determine Value. Pre-money valuations startups receive from incubators are typically low…really low. The “revised for the cash investment only&# pre-money valuation is $600,000. (2)

Incubator 105

Incubator Pre-Money Valuation Option Pool Advisory Board 105

Seeing Both Sides

JULY 15, 2009

VCs have an unfair advantage when it comes to financings. A typical start-up company will do 2-4 venture capital financings before a successful exit (or, conversely, an ignomious ending). In contrast, the typical venture capitalist, either individually or across their partnership, will do 5-10 financings in any given year.

Pre-Money Valuation 49

Pre-Money Valuation Option Pool Stock Options Post-Money Valuation 49

www.payne.org

SEPTEMBER 22, 2011

UPDATE: If youre a founder or near-founder, your equity terms are likely defined by the funding terms negotiated with the investors. For a very good summary of investor terms, see Brad Felds writeups on term sheet terms. My advice: understand the terms of your option grant, especially the strike price.

Equity 56

Equity Employee Vesting Preferred Stock 56