Both Sides of the Table

FEBRUARY 8, 2016

Don’t assume that you can “just do a down round” if necessary. Down rounds are corrosive. If you need to clean up your own cap table first – while very hard to do – it will make outside funding easier. Optimize for a W more than % dilution in these circumstances. Start early.

Burn Rate 150

Burn Rate Cap Table Startup Dilution 150

Feld Thoughts

FEBRUARY 9, 2016

“If you need to clean up your own cap table first – while very hard to do – it will make outside funding easier” Again, go read the post now – I’ll wait. Then, if you end up doing a down round, it suddenly matters a lot. Don’t worry about this too much, until you do a down round.

Cap Table 70

Cap Table Down Round Liquidation Preference Founder 70

Hunter Walker

AUGUST 8, 2023

Restructures, Down Rounds, and Pay to Plays. The reality is lots of companies – many of them quite promising – have already undergone, or will be facing, next financings which “clean up” old cap tables. Whatever gets reported is just the tip of the iceberg.

Portfolio 118

Portfolio Cap Table LP Valuation 118

ithacaVC

FEBRUARY 1, 2018

It is highly typical for a startup to have small investors on its cap table. The treatment of the friends, family and angels (FFA) as the startup matures and raises larger rounds of financing over time is interesting. Or the economy tanks or stock market tanks moving valuations down at inopportune times for the startup.

Preemptive Right 45

Preemptive Right Cap Table Valuation Dilution 45

This is going to be BIG.

AUGUST 21, 2023

But back to the cap table. Here’s why VC’s don’t actually care about your prior cap table in most circumstances. We want what we want and if we really want it, we don’t really care about what else is going on with the cap table. That’s why down rounds exist. was a term sheet.

Cap Table 78

Cap Table Term Sheet Database Option Pool 78

abovethecrowd.com

APRIL 20, 2016

Also, they have a strong belief that any sign of weakness (such as a down round) will have a catastrophic impact on their culture, hiring process, and ability to retain employees. Their own ego is also a factor – will a down round signal weakness? A down round is nothing. Get over it and move on.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40

www.paulgraham.com

APRIL 28, 2010

So the totalnumber of new shares issued is 750, and the cap table becomes: shareholder shares percent -VCs 650 33.3angel 200 10.3uncle 50 2.6each founder 250 12.8employee 36* 1.8 10 ]One new thing the company might encounter is a downround , or a funding round at valuation lower than the previousround.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76