Agile VC

APRIL 17, 2011

Interesting to note that Hafner and English own common stock but also made meaningful investments in the Series A & B rounds. Notes: In an IPO preferred share classes are converted into common stock, and liquidation preferences and accumulated but unpaid dividends essentially go away. as of 12/31/09). Author howerl.

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

Feld Thoughts

DECEMBER 28, 2011

If accepted, each company will receive an equity investment of $20,000 in exchange for six percent of the company in common stock, which will be held by TechStars. The companies will interact with and have access to mentors during the course of the program including Microsoft executives, entrepreneurs, and investors.

Intellectual Property 134

Intellectual Property Common Stock Seattle Cofounder 134

The Next Web

JUNE 15, 2012

By linking number of shares to hours worked or other quantifiable measures, you run the risk of establishing the price per share of your common stock or options. But beyond motivation, there are more pragmatic factors at play here too. Don’t jeopardize your S Corporation status.

Equity 116

Equity Stock Options Vesting Stock 116

Scott Edward Walker

SEPTEMBER 28, 2011

Introduction This post was originally part of the “ Ask the Attorney ” series I am writing for VentureBeat (one of my favorite websites for entrepreneurs). Below is a longer, more comprehensive version. Question My co-founders and I are working on a cool new site, and we’ll be ready to launch in a few weeks. Vesting Restrictions.

Vesting 89

Vesting Software Review IP Intellectual Property 89

Startup Lessons Learned

AUGUST 26, 2009

But theres no denying the level of support for entrepreneurs that we enjoy. They take common stock, not preferred, a fact that the entrepreneurs mentioned to me many times. And every year, it looks as if one or two entrepreneurs from the program decide to stay. And do your customer development.

San Francisco 113

San Francisco Silicon Valley Startup Lean 113

David Teten

JANUARY 19, 2021

Eligible for favorable treatment under Qualified Small Business Stock exemption, if structured as equity. This applies if the investment converts into common stock; details are beyond this essay’s scope. See Why Are Revenue-Based Investors Investing in Women & Diverse Entrepreneurs? Founder retains control.

Cofounder 78

Cofounder Technical Review Equity Dividend 78

Up and Running

AUGUST 17, 2015

As I read stories of college dropouts who had successfully sold tech companies, or entrepreneurs with innovative ideas who made it big on Shark Tank, it became clear that there was no set path to startup success. C Corp versus LLC, non-competes, liquidation preferences, preferred versus common stock, and so on).

Entrepreneur 60

Entrepreneur Cofounder Angel Investor eCommerce 60

View from Seed

DECEMBER 4, 2014

In addition to being a co-founder of NextView Ventures, Lee was an early member of PayPal and a founding team member at LinkedIn, so he speaks as both a former entrepreneur and a VC. You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently.

Equity 315

Equity Founder Sweat Equity Cofounder 315

Startup Professionals Musings

JULY 8, 2011

Some entrepreneurs try to start with a huge number, hoping they can negotiate and close on a smaller one, while others understate their requirements, in hopes of getting their foot in the door with an investor. The most common case is an equity investment, but there are many terms that can impact what request size is credible.

Entrepreneur 234

Entrepreneur Valuation Early Stage Warrant 234

Both Sides of the Table

SEPTEMBER 18, 2014

At an accelerator … 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. Your A round?

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Feld Thoughts

JUNE 11, 2021

Since releasing my newest book The Entrepreneur’s Weekly Nietzsche: A Book for Disruptors I’ve been continually getting the questions “Why Philosophy and Entrepreneurship?” For entrepreneurs? We didn’t have any financing except for Brad’s credit card and the $10 with which we had purchased our common stock.

Common Stock 70

Common Stock Boston Europe Software Developers 70

Both Sides of the Table

APRIL 14, 2010

It’s meant to be a bit provocative but the reality is that I give this advice to entrepreneurs all the the time and I usually leave the “e&# off of the end. I normally offer this advice in the capacity of really wanting to help entrepreneurs so please bear with me. management, founders, angel investors) get any money.

Venture Capital 289

Venture Capital Liquidation Preference Common Stock Dividend 289

Agile VC

DECEMBER 4, 2014

You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently. It’s also worth keeping in mind that regardless of how the founders’ common stock is divided, there will be future issuance of stock that will dilute the founders over the lifecycle of the company.

Cofounder 255

Cofounder Equity Founder Sweat Equity 255

Startup Professionals Musings

JANUARY 15, 2021

When an entrepreneur first incorporates a business, they may find themselves the proud owner of 10 million shares of common stock, commonly called founder’s shares. Make sure the government waits for a stock sale to collect taxes. This is where things get technical, but the principles are really quite simple. In the U.S.,

Vesting 298

Vesting Dilution Stock Founder Vesting 298

Startup Company Lawyer

AUGUST 31, 2012

Ted Wang believes that the “reason that capped convertible debt is the current market leader is that entrepreneurs have been conditioned over time to believe that convertible debt is (a) faster (b) cheaper and (c) better for them than equity investment.”

Convertible Security 73

Convertible Security Equity Security Preferred Stock 73

Startup Professionals Musings

MARCH 23, 2014

In reality, so-called “Founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Here are some typical special terms and considerations for Founder’s stock: Negligible real value.

Stock 256

Stock Vesting Common Stock Founder Vesting 256

Up and Running

SEPTEMBER 19, 2017

For a business that anticipates needing, for example, $500,000 in startup capital, that means that best-case scenario Klemm can expect to give up half of his business’s common stock (and an even larger percentage of control of the business once the deal’s fine print provisions are considered). Consequently, he passed.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

Startup Professionals Musings

OCTOBER 29, 2013

Some entrepreneurs try to start with a huge number, hoping they can negotiate and close on a smaller one, while others understate their requirements, in hopes of getting their foot in the door with an investor. The most common case is an equity investment, but there are many terms that can impact what request size is credible.

Valuation 258

Valuation Early Stage Warrant Common Stock 258

Startup Company Lawyer

MARCH 14, 2010

My general opinion is that anything that makes the financing process faster and easier or otherwise educates entrepreneurs is a good thing. (A Founders Institute Plain Preferred Term Sheet (by WSGR – disclaimer, I represent the Founders Institute and was involved in drafting this document). Legal fees.

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

Startup Professionals Musings

SEPTEMBER 27, 2023

When an entrepreneur first incorporates a business, they may find themselves the proud owner of 10 million shares of common stock, commonly called founder’s shares. Make sure the government waits for a stock sale to collect taxes. This is where things get technical, but the principles are really quite simple. In the U.S.,

Stock 240

Stock .Net Vesting Founder Vesting 240

Startup Professionals Musings

OCTOBER 7, 2010

In reality, so-called “founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Here are some typical special terms for founder’s stock: Negligible par value. Marty Zwilling.

Stock 214

Stock Vesting Common Stock Founder Vesting 214

Startup Professionals Musings

JANUARY 22, 2013

In reality, so-called “founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Here are some typical special terms and considerations for founder’s stock: Negligible real value.

Vesting 245

Vesting Common Stock Stock Founder Vesting 245

Startup Professionals Musings

SEPTEMBER 14, 2010

Entrepreneurs sometimes assume an initial agreement with an angel is a commitment, so they start spending before any money is received. It’s true that angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. Define equity type. Marty Zwilling.

Term Sheet 227

Term Sheet Pre-Money Valuation Due Diligence Post-Money Valuation 227

Growthink Blog

JANUARY 24, 2011

I get the same question a lot from entrepreneurs raising equity capital (venture capital or angel funding). The question is whether they need to issue common or preferred stock. The answer depends on how and what rights are defined in the preferred stock. read more.

Preferred Stock 93

Preferred Stock Stock Common Stock Liquidation Preference 93

Startup Professionals Musings

JANUARY 27, 2012

Entrepreneurs sometimes assume an initial agreement with an Angel is a commitment, so they start spending before any money is received. It’s true that Angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. Define equity type.

Term Sheet 223

Term Sheet Pre-Money Valuation Due Diligence Angel Investor 223

Startup Professionals Musings

SEPTEMBER 19, 2012

Some entrepreneurs try to start with a huge number, hoping they can negotiate and close on a smaller one, while others understate their requirements, in hopes of getting their foot in the door with an investor. The most common case is an equity investment, but there are many terms that can impact what request size is credible.

Valuation 236

Valuation Early Stage Warrant Common Stock 236

Both Sides of the Table

SEPTEMBER 8, 2012

If you do a capped note it’s bad for the entrepreneur. Here is what I recommend very often – privately – to startup entrepreneurs for angel funding. I recently wrote about my views that startups rounds should be priced. If you do an uncapped note it’s bad for the investor. ” I wrote about it here.

Pre-Money Valuation 294

Pre-Money Valuation Finance Liquidation Preference Warrant 294

Startup Professionals Musings

JUNE 9, 2010

Some entrepreneurs try to start with a huge number, hoping they can negotiate and close on a smaller one, while others understate their requirements, in hopes of getting their foot in the door with an investor. The most common case is an equity investment, but there are many terms that can impact what request size is credible.

Valuation 227

Valuation Early Stage Warrant Startup 227

Both Sides of the Table

MAY 13, 2013

A couple of tech giants throw millions around in either cash (for which they have hoards) or part with some publicly traded stock. And a few teams of super talented, educated and bright entrepreneurs make a few mill. I look for entrepreneurs who set out on their journeys to do exactly that – build big businesses.

Liquidation Preference 357

Liquidation Preference Early Stage Retention Lock-up Period 357

www.inc.com

SEPTEMBER 24, 2011

Entrepreneur news from reporter Eric Markowitz. In the 1990s, Graham was one of those entrepreneurs giving away equity in exchange for crucial services. Graham also pushes for common stock, the right to participate in future funding rounds to preserve the size of the stake, and a guaranteed seat on the board. Newsletters.

Arizona 40

Arizona Equity Iowa Venture Capital 40

venturehacks.com

MARCH 21, 2008

Normal advisors are also assembled by naive entrepreneurs who think the mere presence of an advisory board will create social proof and help them raise money. Advisor compensation Whether you’re hiring a normal advisor or super advisor: Advisory shares are usually issued as common stock options. What are advisory shares?

Advisory Board 44

Advisory Board Cap Table Vesting Equity 44

Agile VC

DECEMBER 4, 2014

You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently. It’s also worth keeping in mind that regardless of how the founders’ common stock is divided, there will be future issuance of stock that will dilute the founders over the lifecycle of the company.

Cofounder 173

Cofounder Equity Founder Sweat Equity 173

Gust

MARCH 16, 2014

In reality, so-called “Founder’s” shares are simply common stock, issued at the time of startup incorporation, for a very low price, and normally allocated to the multiple initial players commensurate with their investment or role. Here are some typical special terms and considerations for Founder’s stock: Negligible real value.

Stock 175

Stock Vesting Common Stock Founder Vesting 175

Tim Keane

JANUARY 12, 2010

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. Term-sheets and Valuations: Thinking about Negotiations.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Austin Startup

JULY 6, 2018

More traditional and comprehensive programs often require 5–8% of common stock, but often provide between $20K and $100K up-front as well. Entrepreneurs often celebrate faking it until you make it. Some entrepreneurs find it invaluable. Anti-Dilution. See: Startup Accelerator Anti-Dilution Provisions; The Fine Print.

Dilution 48

Dilution Startup Technical Review Equity 48

Gust

MAY 31, 2014

In a larger startup post Series A or B, the board might be expanded to five people, with two directors chosen by the Common stock holders (the founders), two by the investors (often one by each of two VC funds), and one independent director agreed to by everyone. original post can be found on Quora @ [link] *.

Common Stock 159

Common Stock Startup Founder Stock 159

Both Sides of the Table

MARCH 21, 2010

As startup entrepreneurs we all want to work with them because having their name as reference clients makes it so much easier for marketing, PR, selling to other customers, fund raising and even recruiting. Make the warrants for common stock and not preferred stock. This is the same as with employee stock options.

Warrant 298

Warrant Dilution Startup Stock Options 298