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Getting Funded: Step 4, Due Diligence

Passionate Intensity

“Due Diligence” is a broadly defined term with explanations here: WikiPedia , Webster’s , and elsewhere. YOU should….

Signed Term Sheet

ithacaVC

We (Cayuga Venture Fund) just signed up a term sheet with a new company (Company X). Rather I want to briefly comment on the process leading up to the term sheet and next steps. We presented our first draft of the term sheet to Company X about a week ago. First, the process: 1. It is now mid December.

Term-sheets and Valuations: Thinking about Negotiations - Startups.

Tim Keane

Term-sheets and Valuations: Thinking about Negotiations. Please see later version of this post on May 16, 2010 Entrepreneurs are often not experts in the area of term-sheet negotiations and all of the surrounding issues.   Investors sometimes “present” the terms they’d like and expect the entrepreneurs to react.

Revisiting Paul Graham’s “High Resolution” Financing

Both Sides of the Table

Tags: Raising Venture Capital Startup Advice Tech Market Analysis Term Sheets

What is it Like to Negotiate a VC Round?

Both Sides of the Table

Another problem that arises in financings these days is that after a VC submits a $2 million term sheet all of a sudden a large number of “helpful investors” pop up who were waiting for a “strong lead” and now all of a sudden a $2 million round becomes a $2.75m round. It’s very simple. Size of my check.

Copywrong Again: Founding the Next Pinterest or Napster?

Gust

Is Instapaper like collecting press clippings? (If If so, do you have to buy a copy of each paper first?) Rose likes Gust. What gives?

Bad Notes on VC

Gust

Me: Raising convertible notes as a seed round is one of the biggest disservices our industry has done to entrepreneurs since 2001-2003 when there were “full ratchets” and “multiple liquidation preferences” – the most hostile terms anybody found in term sheets 10 years ago. This week. On the phone …. Him: Yeah. About $1 million.

Notes on the acquisition process

Chris Dixon

I’ve seen many acquisitions bungled by bankers who were either too aggressive on terms or upset the relationship between the startup and acquirer. In terms of ethics and reputations, it is important to be fair to all parties involved: the acquirer, founders, employees, and investors. Talk to people who work in the same sector.

The investment that didn’t happen

K9 Ventures

However, the IP climate remains unchanged, and it’s likely that other villains will continue to exploit similar situations.

How to Work with Lawyers at a Startup

Both Sides of the Table

Shame about not getting it in legal writing that you owned the original IP. Much of this is unfounded – some is not. the link is here.

Burnham's Beat: SkyGrid and the Emergence of Flow-Based Search

Burnham's Beat

4 Things to Do After You Get Your First Term Sheet » 02/13/2008. While some progress has been made in terms of trying to cluster results or help users filter them, by and large, users still just get an unprocessed, unanalyzed data dump when they do a search. Burnhams Beat. Articles on Technology and Finance. About Bill.

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Startup Resources

www.vccafe.com

Cheat Sheets : Equip youself with HTML/CSS cheatsheets! IP Location Tools. WSGR Term Sheet Generator. About VC Cafe. Contact.

Time is the Enemy of All Deals

Both Sides of the Table

We had many term sheets (it was 1999 and we had a pulse) and we were deciding which one to take. We signed a term sheet.

D-Wave's Dream Machine

Fresh Inc.: The Staff Blog

We need to sign away our IP? All of that seeded what is now the biggest IP portfolio in the world in quantum computing. I don''t care."

Getting Due Diligence Ready

StartupCFO

Investors will perform business diligence before they issue a term sheet. I trust you to take my $1 and make it $5 or $10.

The Legal Side of Entrepreneurship

YoungUpstarts

They also need to decide whether to structure terms as an equity deal or a convertible security deal. Financing. ” The Cost of Financing.

Shout Out to Seth Levine, or the In-N-Out burger startup

Scalable Startup

To reuse an overused term – Wait what? Long term employment, new jobs. ” [link]. Worth the read. for over a year: [link].

The Forgotten Founder: YouSendIt’s Khalid Shaikh

Fresh Inc.: The Staff Blog

When you're a given a term sheet, it's like the queen knighting you; you are supposed to genuflect for even gracing you with terms."

A Compilation of the Web's Best Advice for Entrepreneurs

Platforms and Networks

skip to main | skip to sidebar Platforms and Networks Thoughts about platforms, network effects and entrepreneurship Wednesday, November 25, 2009 A Compilation of the Webs Best Advice for Entrepreneurs Below, I link to blog posts and other online resources that offer advice for entrepreneurs. Great list. Tom, well done - solid list. Great list!

When Is A Startup "Venture Fundable?"

Seed Stage Capital

skip to main | skip to sidebar 12 July 2010 When Is A Startup "Venture Fundable?" In a nutshell, the main factors are: 1. The “Big Idea.&#

When to Bring Up Valuation

ithacaVC

In my view, starting off a VC relationship by diving into perhaps the most critical economic term is kind of like, well, moving too fast on a first date. Seriously, pre-money valuation is a function of many things (team strength, size of market, IP, hotness of sector, etc.) Here is why.

Knowledge Is Power: Convertible Note Financing Terms, Part V

Gust

As we conclude our convertible note financing series, there are assorted terms commonly seen in term sheets and deal documents that are worth touching on briefly. Having made it almost to the end of our sample term sheet: Documentation. Returning to our sample term sheet: Note Purchase Agreement.

What Now: Deal or No Deal?

Peter Levine

You realize that some of these terms are not very favorable to SpiderNet, but this deal has the ability to fundamentally change the future for you. Do you agree to these terms and quickly move to lock down a deal, or do you negotiate further, possibly losing the deal to a competitor? Do not agree to a five-year term. What Now?

Piercing the Corporate Veil of Sweat Equity

grasshopperherder.com

As such, you should make sure to think of the proposals as an investor and get a reasonable term sheet. GrasshopperHerder.com. Go for it.

The Best Entrepreneurs Are Hyper Competitive & Hate Losing

Both Sides of the Table

6 months afterwards they laid off 75% of their staff and are existing on fumes to protect their IP to this day. The list is getting quite long.

Channel your Inner VC to Understand Startup Valuations

www.currentlyobsessed.com

Valuation is an important aspect of VC deal terms, and a major determinant of your ultimate outcome. Read Terms that Hurt (Venture Hacks).

Setting And Shaping A Strong Startup Culture

Seed Stage Capital

Over the past several years, Ive had meaningful interactions-- meetings, calls, etc.-- with perhaps 700-800 early stage startups. Opportunity lost.

The Business Plan is Dead; Long Live the Business Plan.

Seed Stage Capital

skip to main | skip to sidebar 10 August 2009 The Business Plan is Dead; Long Live the Business Plan! space, I would agree—to a point. Like This?

Series Seed Financing Documents

www.seriesseed.com

Series Seed Term Sheet (v 2.0). Series Seed Term Sheet. Long term capital gains possible for early exit. It would be helpful to get a California standard employee manual, employee contract/agreements, IP ownership release to company, and confidentiality. SeriesSeed.com. Documents. Comments.

Startup Blog: Getting Rights to the Technology

Taffy Williams

In selecting the technology, you may already have IP or inventors identified but not have the rights yet. Remember this is a business. Now what?

Getting Funded: Step 4, Due Diligence

Passionate Intensity

Due Diligence” is a broadly defined term with explanations here: WikiPedia , Webster’s , and elsewhere. There are funds that prefer to do significant due diligence before issuing a term sheet, and some save the bulk of the detailed work for the time between the term sheet’s signing and the actual closing of financing.

Ask the Angels

Ask the Angels

The strategic buyer will pay a strategic premium because they can see an immediate short term method for recovering the acquisition cost. Too many Angels focus on the near term issues without appreciating that even these decisions need to be seen in the context of the exit. I call these high growth potential products.

Ask the Angels

Ask the Angels

The strategic buyer will pay a strategic premium because they can see an immediate short term method for recovering the acquisition cost. Too many Angels focus on the near term issues without appreciating that even these decisions need to be seen in the context of the exit. I call these high growth potential products.

Ask the Angels

Ask the Angels

The strategic buyer will pay a strategic premium because they can see an immediate short term method for recovering the acquisition cost. Too many Angels focus on the near term issues without appreciating that even these decisions need to be seen in the context of the exit. I call these high growth potential products.

Ask the Angels

Ask the Angels

The strategic buyer will pay a strategic premium because they can see an immediate short term method for recovering the acquisition cost. Too many Angels focus on the near term issues without appreciating that even these decisions need to be seen in the context of the exit. I call these high growth potential products.