Startup Company Lawyer

AUGUST 31, 2012

Quick answer: convertible equity (or a convertible security) is convertible debt without the repayment feature at maturity or interest. 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.

Convertible Security 73

Convertible Security Equity Security Preferred Stock 73

YoungUpstarts

OCTOBER 28, 2015

They also need to decide whether to structure terms as an equity deal or a convertible security deal. “If you’re going to raise $1 million, my advice is to propose a convertible security, because you can get it done quickly and less expensively,” said Schmitz. Convertible Securities.

Convertible Security 100

Convertible Security IP Technical Review Software Review 100

Hippoland

AUGUST 17, 2016

Since this is a hefty topic that we could discuss for days, in this post I’ll aim to cover just the pros and cons of each from a founder’s perspective and will NOT cover: What is a convertible note, equity, or convertible security ? In general, I’m a big fan of convertible notes or convertible securities for seed stage founders.

Equity 48

Equity Convertible Security Silicon Valley Technical Review 48

Gust

SEPTEMBER 5, 2012

I won’t rehash all of the customary convertible note financing deal terms and points of negotiation here. (For Like any promissory note, it bears interest (usually at a nominal rate) and has a maturity date on which the loan must be repaid if it hasn’t been converted to stock (typically around 18 months).

Finance 134

Finance Convertible Security Equity Seed Stage 134

Austin Startup

NOVEMBER 6, 2017

Many angel investors, and also strategic investors, are comfortable investing in LLCs, particularly under a convertible security structure that doesn’t immediately result in equity holdings. Originally published at Silicon Hills Lawyer.

Delaware 48

Delaware LLC Startup Silicon Valley 48

Hippoland

JANUARY 4, 2017

So let’s say a startup raises an equity round from a big VC after raising a convertible note round. How does an angel investor convert his convertible note into equity? The convertible note specifies the mechanics in which the investor receives shares. Convertible securities, in so many ways, act like convertible notes.

Convertible Security 48

Convertible Security Equity Security Silicon Valley 48

Business Plan Blog

NOVEMBER 13, 2013

Bridge notes/loans are an example of convertible debt. Convertible debt provides startups with a relatively easy way to procure financing. Various terms such as price cap, discount, conversion to equity, etc., Pros and Cons of Convertible Debt. Example: An angel investor contributes $300,000 convertible note to a startup.

Finance 93

Finance Accredited Investor Angel Investor Seed Capital 93