Startup Professionals Musings

AUGUST 24, 2016

I always tell entrepreneurs that two heads are better than one, so the first task in many startups is finding a co-founder or two. Giving a co-founder a salary won’t get you the “fire in the belly” you want. Each co-founder should get equity for value, based on these key variables: Lived a key role in a previous startup.

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Both Sides of the Table

AUGUST 30, 2010

Let me preface by saying I obviously have a vested interest in being wrong about tough times ahead but as the old saying goes, “hope for best, plan for the worst.”. Let me preface by saying I obviously have a vested interest in being wrong about tough times ahead but as the old saying goes, “hope for best, plan for the worst.”.

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The Startup Toolkit

FEBRUARY 15, 2013

false As a cheatsheet, the “normal” equity structure is: Founder terms: 4 year vesting, 1 year cliff, for everyone, including you. 2.0% ) : 4 year vesting, optional cliff, full acceleration on exit. When it comes to equity terms, there are only 3 things to understand: vesting, cliffs, and acceleration. Advisor terms ( 0.5–2.0%

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Both Sides of the Table

AUGUST 17, 2009

The meme was kicked off by Chris Dixon with this post saying that term sheets need to be simplified and align investor / founder interests. Last to weigh in was Brad Feld whose blog post argues that the only 2 terms that should be negotiated are amount raised & valuation. In my first company there was no vesting in the seed round.

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The Startup Magazine

FEBRUARY 21, 2024

Arif Bhalwani is the co-founder and CEO of Third Eye Capital (TEC) in Toronto, Canada. As an investor, these experiences have honed my ability to see beyond spreadsheets and valuations, to the core of what makes businesses thrive: the people, the vision, and the relentless pursuit of excellence. The firm has made more than $4.5

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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. Should founders have anti-dilution rights?

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Steve Blank

MAY 19, 2015

While he kept bringing the conversation back to their big valuation I tried to steer the conversation back to how they were going to deal with: training the influx of new hires – in both culture and job specific tasks. They had doubled headcount from 100 to 200 in the last year and were planning to double again.) the company had.

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www.avc.com

SEPTEMBER 22, 2011

To be clear, these are hires we are talking about, not co-founders. Co-founders are an entirely different discussion and I am not talking about them in this post. This is NOT your 409a valuation (we call that "fair value"). This "best value" can be the valuation on the last round of financing.

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Startup Professionals Musings

APRIL 11, 2021

Here are five of the most common examples: Failure to document a Founder agreement at the beginning. This oversight can lead to the so-called “forgotten Founder” problem. Trouble with the IRS over Founders stock value. Founders ignore non-compete clauses from former employers.

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Both Sides of the Table

JULY 16, 2013

It goes like this, “If your next round investor can see how fast you’re scaling then you can raise money based on your user traction and your valuation can hit the sky. And revisit my point about whether you are the archetypal founder who will get tons of money thrust upon you. I understand the logic. Your VC is right.

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David Teten

DECEMBER 3, 2019

To learn more about this space, I suggest join an online community I co-founded, PEVCTech. . Tim Friedman, Founder, PE Stack , said, “If I could offer one piece of advice to today’s managers, it would be to take the time to understand the demands of the modern institutional LP. The 11 Steps of Investing in Private Companies.

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Startup Professionals Musings

JULY 10, 2012

Here are five of the most common examples: Failure to document a Founder agreement at the beginning. This oversight can lead to the so-called “forgotten founder” problem. Trouble with the IRS over Founders stock value. Founders ignore non-compete clauses from former employers.

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Startup Professionals Musings

MAY 2, 2011

Here are five of the most common examples: Failure to document a founder agreement at the beginning. This oversight can lead to the so-called “forgotten founder” problem. 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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Startup Professionals Musings

AUGUST 7, 2013

Here are five of the most common examples: Failure to document a Founder agreement at the beginning. This oversight can lead to the so-called “forgotten Founder” problem. Trouble with the IRS over Founders stock value. Founders ignore non-compete clauses from former employers. Marty Zwilling.

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www.inc.com

SEPTEMBER 24, 2011

Chip Morse , cofounder and partner with Morse, Barnes-Brown & Pendleton P.C., As you think about how much equity to offer, have a reasonable valuation in mind thats been determined using professional advice. He suggests granting the options on day one but making sure they vest only upon satisfactory completion of the project.

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Start Up Blog

APRIL 28, 2011

What we’ve seen in digital…’A mashup co-creation, mass customised society’… we will inevitably see in retail…. Probably as a function of the gold standard (global price of gold as the trading valuation mechanism) with some form of digital instant and unseen conversion from our home currency into some quantum derived from gold.

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Gust

NOVEMBER 4, 2011

Entrepreneurs and investors who have spent any time dealing with convertible debt seed financing transactions are likely to have encountered the subject of valuation caps. Valuation caps can come into play in settings other than seed-stage convertible note financing rounds. Read on for a fuller explanation. by February 2006).

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Feld Thoughts

JULY 29, 2011

Finance Friday’s gets off the ground with today’s post by introducing you to an imaginary startup, the entrepreneurs that we’ll being following throughout the series, and their first challenges: splitting up the founders’ equity and addressing the case where one of the founders provides the initial seed capital for the business.

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Startup Professionals Musings

APRIL 19, 2010

Here are some examples: Failure to document a founder agreement at the beginning. This shortcut can lead to the so-called “forgotten founder” problem. 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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Eric Friedman

JUNE 27, 2016

Total = 0.75% for 3 advisors that vest as you see fit to help you over the next 1–4 years (more on vesting below). Big strategic advisors are the folks that add credibility to your co. from a 10 year old co. Here are the questions I like to see founders ask potential advisors; 1. Vesting Schedules.

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Startup Lessons Learned

JULY 26, 2011

You might think that "company valuation" refers, naturally, to how much your company is - you know - valued. But none of that is enough to get me to recommend this new book , co-authored with Jason Mendelson. But this kind of thinking will get you in trouble fast. He's said nice things about me and my book. I think he's a great guy.

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Both Sides of the Table

FEBRUARY 14, 2016

I have been talking about my concerns about valuations for the past couple of years because, well, they’ve been rising very rapidly the past two years! ” “Mark has a vested interest in talking down valuations of startups.” ” “Mark has a vested interest in talking down valuations of startups.”

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Business Plan Blog

NOVEMBER 20, 2013

Stage 2: Co-Founder. You do not have the funds to pay this person, so you decided to add them on as a co-founder. It can be difficult to give away a piece of your “baby”, and this early in the startup stage it is almost impossible to determine the valuation to your company. Startup Funding'

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venturehacks.com

OCTOBER 21, 2010

Use a hiring plan to justify a small option pool, increase your share price, and increase your effective valuation. Reading on, the term sheet states, “The $8 million pre-money valuation includes an option pool equal to 20% of the post-financing fully diluted capitalization.&# The option pool lowers your effective valuation.

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K9 Ventures

JULY 22, 2009

This has several advantages: 1) If you are going to be bringing on co-founders or employees, the fact that the company has already been incorporated, and is official, can have an impact on how the equity split gets portioned out. ’ 3) The same also applies when having valuation discussions with VCs.

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Scott Edward Walker

OCTOBER 27, 2015

We charge a flat fee of $2,000, plus filing fees, for up to three co-founders and it includes unlimited phone calls and emails. Thus, founders never have to worry about picking-up the phone and asking their lawyers questions. Indeed, we have done more than 300 Startup Packages and the appeal is obvious: no billable hours.

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Altgate

DECEMBER 11, 2008

Have a founders agreement. If you can’t afford this then make very simple, clear, plain English, written, signed agreements with you “co-founders”. If you can’t afford this then make very simple, clear, plain English, written, signed agreements with you “co-founders”. Make sure you include a basic form of vesting.

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Ben's Blog

APRIL 28, 2010

In this post, I describe why we prefer to fund companies whose founder will run the company as its CEO. As we looked at the history of great technology companies, we discovered that founders ran an overwhelming majority of them for a very long time, including: Acer—Stan Shih. Siebel—Tom Siebel. Sony—Akio Morita. Sun—Scott McNeely.

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venturehacks.com

MARCH 21, 2008

The options typically vest monthly over 1-2 years with 100% single-trigger acceleration and no cliff. Although the advisor is on a vesting schedule, you should expect them to add most of their value up-front—that’s normal. Does this stake need to have vesting schedule? Out of these, only fund raising is critical for us.

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Altgate

JUNE 25, 2012

Re-posted from post co-authored with Prof. —————– Dead equity — equity held by employees and founders no longer working at the company — is a large and growing problem. Founders and hires have always quit, after all, and their companies don’t always have a way to reclaim their equity.

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Altgate

AUGUST 25, 2012

Re-posted from post co-authored with Prof. —————– Dead equity — equity held by employees and founders no longer working at the company — is a large and growing problem. Founders and hires have always quit, after all, and their companies don’t always have a way to reclaim their equity.

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thestartuplawyer.com

FEBRUARY 24, 2010

He obviously never launched a startup and got shafted by a co-founder. He obviously never launched a startup and got shafted by a co-founder. He obviously never launched a startup and got shafted by a co-founder. You can start by examining every aspect of the co-founder relationship.

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venturehacks.com

SEPTEMBER 22, 2011

Offers from top-tier firms increase your valuation. Offers from top-tier firms increase your valuation. They don’t even try to get market price for their investment; they limit their holdings to leave the founders enough stock to feel the company is still theirs.” 4 responses so far · Comments RSS. #.

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www.readwriteweb.com

FEBRUARY 23, 2010

7: Invest in Advisors : Give away a small amount of stock to advisors (which they can vest after a few years) who you can call on in a pickle or for general advice as issues arise. Posted by: Heather Plude | February 21, 2010 7:19 AM @John Yeng Kevin Rose is an angel investor, serial entrepreneur and the Founder of Digg and WeFollow.

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Start Up Blog

DECEMBER 29, 2019

If it sounds ridiculous to you, then just remember that in many cultures we gather in giant stadiums to watch teams of adult humans dressed in co-ordinated attire kick dead animal skins through white sticks (football). It’s amazing what can be said when words are not guided by vested interests. Facebook goes public.

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