Startup Professionals Musings

MAY 2, 2011

Although every startup is unique, there are certain common avoidable mistakes that can lead to legal complications which jeopardize the long-term success of the business. Here are five of the most common examples: Failure to document a founder agreement at the beginning. Trouble with the IRS over founders stock value.

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Non-Compete Accredited Investor Entrepreneur Cofounder 246

Startup Professionals Musings

APRIL 19, 2010

Although every startup is unique, there are certain common avoidable mistakes that can lead to legal complications which jeopardize the long-term success of the business. Here are some examples: Failure to document a founder agreement at the beginning. This shortcut can lead to the so-called “forgotten founder” problem.

Non-Compete 125

Non-Compete Accredited Investor Startup Cofounder 125

The Startup Lawyer

JANUARY 26, 2010

Now if your startup received a $5MM Series A investment from a venture capital firm, how many developers (that you can recall) would come out of the shadows of the internet and claim to be your startup’s long lost founder? The answer to this question depends on how well your startup secures its intellectual property.

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IP Intellectual Property Founder Stock Options 57

The Next Web

JULY 28, 2013

. Just because you have a great idea doesn’t mean your startup will succeed, and there’s a simple reason for this: concepts don’t make companies. Startups depend on everything from the capabilities of their founders to the depth of their pockets. Group Photo Sharing. We’ll see if that happens. Replacing Email.

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Social Network Startup eCommerce Issued Shares 159

Scott Edward Walker

MAY 15, 2012

Part 2, entitled “ Convertible Note Seed Financings: Econ 101 for Founders ,” addressed the economics. This part will address certain tricky issues. What Happens If a Startup is Acquired Prior to the Note’s Conversion to Shares of Preferred Stock? This post was originally published on TechCrunch.]

Finance 64

Finance Founder Accredited Investor Preferred Stock 64

Startup Professionals Musings

NOVEMBER 28, 2012

I’ve been advising and mentoring startups and growth companies for years, and find myself always pushing them to try something new, for the sake of growth and survival. Early co-founders often drop out of the picture due to disagreements, and you forget about them, but they don’t forget about the verbal promises you made.

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Entrepreneur Intellectual Property LLC Burn Rate 274

Scott Edward Walker

APRIL 22, 2012

Part 3 will cover certain special issues, such as (i) what happens if the startup is acquired prior to the note’s conversion to equity? Finally, founders should be aware that investors will sometimes push for the issuance of warrants in lieu of a discount. Specifically, a cap is a ceiling on the value of the startup (i.e.,

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Pre-Money Valuation Finance Liquidation Preference Founder 72

Scott Edward Walker

APRIL 9, 2012

Venture capital funds, seed funds, super angels, angel groups, incubators, and “friends and family” are all playing the seed financing game and investing early in startups in an attempt to land the next Facebook. and (iii) what are the advantages of issuing convertible notes? This post was originally published on TechCrunch.]

Preferred Stock 87

Preferred Stock Finance Common Stock Liquidation Preference 87

Scott Edward Walker

SEPTEMBER 21, 2011

A sophisticated angel investor understands how the startup game is played and the role that he plays. Tips #3: Unless You’re Raising $750,000 or More, Issue Convertible Notes. Finally, unless the startup is raising at least approximately $750,000, it generally is not in the company’s interest to issue shares of preferred stock.

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Preferred Stock Angel Investor Entrepreneur Common Stock 45

www.mattbartus.com

DECEMBER 9, 2012

Perspectives on issues affecting founders, startups and investors from a veteran startup lawyer in Silicon Valley. If you are a company that is fundraising, keep in mind that there are a few different levers you can pull to change the amount of dilution that the founders will experience. — 23 Comments.

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Warrant Valuation Pre-Money Valuation Term Sheet 40