Feld Thoughts

DECEMBER 28, 2011

Recently, Microsoft announced the Microsoft Kinect Accelerator , a program created to incubate startups building the next generation of innovative experiences for the Kinect. 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.

Intellectual Property 134

Intellectual Property Common Stock Seattle Cofounder 134

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). This is a particular concern if the startup is in the same space as a founder’s prior employer. Below is a longer, more comprehensive version. Vesting Restrictions. IP Ownership.

Vesting 89

Vesting Software Review IP Intellectual Property 89

Agile VC

APRIL 17, 2011

AGILEVC My idle thoughts on tech startups. Interesting to note that Hafner and English own common stock but also made meaningful investments in the Series A & B rounds. One can infer valuations based on per share prices of preferred stock and oustanding common shares (~5.3M How to Evaluate Firms for a Seed VC.

Pre-Money Valuation 113

Pre-Money Valuation Liquidation Preference Dividend Common Stock 113

Up and Running

SEPTEMBER 19, 2017

Capital investments are like gasoline on a startup business’s metaphorical fire. If you’re like most startup CEOs, your startup has been your personal fiefdom and baby. Background: Justin Klemm’s analytics and website uptime startup, Ghost Inspector , wants to revolutionize the way businesses manage their ecommerce funnels.

Private Equity 94

Private Equity Pre-Money Valuation Equity Startup 94

The Next Web

JUNE 15, 2012

From Silicon Valley to Peoria, Illinois, cash-strapped startups look for inventive way to finance their business – often handing out equity to employees, consultants, vendors, and other service providers. Speed is often of the essence early on in the startup lifecycle, and that often means rushing into casual arrangements.

Equity 116

Equity Stock Options Vesting Stock 116

View from Seed

DECEMBER 4, 2014

Editor’s note: Understanding how to divide founder equity at a startup can be tricky, even to the point of reaching emotional riffs between founders. 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.

Equity 315

Equity Founder Sweat Equity Cofounder 315

David Teten

JANUARY 19, 2021

More and more startups are pursuing Revenue-Based VCs , but “RBI” doesn’t fit everyone. 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. Of the Inc. raised from angels.

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

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. But that’s only the beginning of the story.

Vesting 245

Vesting Common Stock Stock Founder Vesting 245

Startup Professionals Musings

JULY 8, 2011

Startups ask me “How much money should I ask for?” 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. More restrictive terms reduce the credible investment amount.

Entrepreneur 234

Entrepreneur Valuation Early Stage Warrant 234

Austin Startup

JULY 6, 2018

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

Dilution 48

Dilution Startup Technical Review Equity 48

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

Both Sides of the Table

MARCH 21, 2010

This is part of my ongoing series on Startup Advice. 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.

Warrant 298

Warrant Dilution Startup Stock Options 298

Startup Professionals Musings

JUNE 9, 2010

Startups ask me “How much money should I ask for?” 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. Tags: entrepreneur startup funding business. Marty Zwilling.

Valuation 227

Valuation Early Stage Warrant Startup 227

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. Startup owners need to assume a three to five year wait for a liquidity event, such as acquisition or going public, before they can cash out. In the U.S.,

Vesting 298

Vesting Dilution Stock Founder Vesting 298

Tim Keane

JANUARY 12, 2010

Startups and angels: Along the way to success. 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. times at six years.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

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

Startup Company Lawyer

AUGUST 31, 2012

Over the past few years, convertible debt has emerged as a quick and inexpensive method for startup companies to raise money from angel investors and early stage venture funds. ” As a result, Ted introduced the Series Seed preferred stock documents as an alternative to convertible debt for early stage investments. Background.

Convertible Security 73

Convertible Security Equity Security Preferred Stock 73

Agile VC

DECEMBER 4, 2014

Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits. You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently.

Cofounder 255

Cofounder Equity Founder Sweat Equity 255

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. entrepreneur founder rules startup stock' Marty Zwilling.

Stock 256

Stock Vesting Common Stock Founder Vesting 256

Startup Professionals Musings

OCTOBER 29, 2013

Startups ask me “How much money should I ask for?” 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. entrepreneur funding request investor startup'

Valuation 258

Valuation Early Stage Warrant Common Stock 258

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. Startup owners need to assume a three to five year wait for a liquidity event, such as acquisition or going public, before they can cash out. In the U.S.,

Stock 240

Stock .Net Vesting Founder Vesting 240

YoungUpstarts

JUNE 26, 2020

by Rizwan Virk, author of “ Startup Myths and Models: What You Won’t Learn in Business School “. If you are building a startup, you’ll find no shortage of people who are willing to give you advice, particularly when it comes to raising financing. The real key is to have an entrepreneur that is obsessed with a small market.

Finance 205

Finance Silicon Valley Valuation Startup 205

Both Sides of the Table

MAY 13, 2013

For the past 5 years or so Google, Facebook and a handful of tech industry giants have been quietly buying scores of early-stage startups for their talent. A couple of tech giants throw millions around in either cash (for which they have hoards) or part with some publicly traded stock. Go do a startup. And who cares, right?

Liquidation Preference 357

Liquidation Preference Early Stage Retention Lock-up Period 357

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. Tags: entrepreneur funder's stock startup investor business. Marty Zwilling.

Stock 214

Stock Vesting Common Stock Founder Vesting 214

Gust

MAY 31, 2014

So before a startup receives outside funding, the board is “elected” by—and usually consists of—the founders (although it may exist in name only.). Invested Interests board of directors business entrepreneur founders startup' original post can be found on Quora @ [link] *.

Common Stock 159

Common Stock Startup Founder Stock 159

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 In addition, I think that a “peace treaty&# between early-stage investors and startup companies on standard terms (at least at a term sheet level) is a step in the right direction.

Finance 70

Finance Software Review Term Sheet Liquidation Preference 70

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

Both Sides of the Table

SEPTEMBER 8, 2012

I recently wrote about my views that startups rounds should be priced. 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. Almost every startup needs an anchor. ” I wrote about it here.

Pre-Money Valuation 294

Pre-Money Valuation Finance Liquidation Preference Warrant 294

Startup Professionals Musings

SEPTEMBER 19, 2012

Startups ask me “How much money should I ask for?” 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. More restrictive terms reduce the credible investment amount.

Valuation 236

Valuation Early Stage Warrant Common Stock 236

Startup Professionals Musings

MAY 18, 2015

When an entrepreneur first incorporates his or her business, he or she may find him or herself the proud owner of 10 million shares of common stock, commonly called founder’s shares. Startup owners need to assume a three to five year wait for a liquidity event, such as acquisition or going public, before they can cash out.

Stock 120

Stock Vesting Common Stock Founder Vesting 120

Agile VC

DECEMBER 4, 2014

Across both the startups I’ve personally been involved in (PayPal and LinkedIn) and the startups in which I’ve been an investor, I’ve seen a broad range of co-founder equity splits. You can then work with your law firm to formally draw up founder common stock paperwork either then or subsequently.

Cofounder 173

Cofounder Equity Founder Sweat Equity 173

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

venturehacks.com

MARCH 21, 2008

Venture Hacks Good advice for startups. 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. Advisory shares are normal common stock. Disclaimer: This is not legal advice. See Part 1 for the rest.

Advisory Board 44

Advisory Board Cap Table Vesting Equity 44

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. Invested Interests entrepreneur founders stock startup'

Stock 175

Stock Vesting Common Stock Founder Vesting 175

www.inc.com

SEPTEMBER 24, 2011

Entrepreneur news from reporter Eric Markowitz. Advisor. ); STARTUP. In the 1990s, Graham was one of those entrepreneurs giving away equity in exchange for crucial services. If Graham bets on the wrong entrepreneur, he could lose money--and get swamped with managerial problems at the same time. "My Email address: Home.

Arizona 40

Arizona Equity Iowa Venture Capital 40

ReadWriteStart

JANUARY 28, 2022

With the rise of startups and growing businesses , it has become more critical for investors to have a thorough understanding of equity to be aware of all of the advantages they are receiving from the companies they have invested in. Common stock. The holding of common stock in a company indicates ownership in the corporation.

Valuation 108

Valuation Equity Warrant Common Stock 108