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When Should Startup Founders Discuss Valuation with Seed VCs?

View from Seed

Sharing these pricing expectations early with potential lead investors fundamentally qualifies your conversations, but it also runs the risk of prematurely losing a potential financing partner, or else it can reduce options to maximize your fundraise outcome. Building a startup and currently in the seed stage?

Valuation 336
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A Primer on Angel Investment ‘Simple Term Sheets’

Startup Professionals Musings

It’s true that angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. These “IV drip” financings may reduce risk for investors, but put more pressure on founders. But due diligence and paperwork take time, and can change everything.

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Keep Term Sheets Simple for Quicker Cash to Spend

Startup Professionals Musings

It’s true that Angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. These “IV drip” financings may reduce risk for investors, but put more pressure on founders. But due diligence and paperwork take time, and can change everything.

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Keep Term Sheets Simple for Quicker Cash to Spend

Gust

It’s true that angel investors typically do not present entrepreneurs with overly complicated deal structures, especially when compared to venture capitalists. These “IV drip” financings may reduce risk for investors, but put more pressure on founders. Due diligence and paperwork take time, and can change everything.

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Knowledge Is Power: Convertible Note Financing Terms, Part II

Gust

Last week , we gave some attention to the “why” behind convertible note financing for early stage startups. In this installment, I’ll dig into the “how” by dissecting an example term sheet based on a real deal. As with so many subjects in law and finance, mastering the jargon is half the battle.

Finance 79
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Knowledge Is Power: Convertible Note Financing Terms, Part IV

Gust

In Parts II and III, we looked at commonly used mandatory and voluntary conversion language in convertible notes. To account for scenarios in which the startup is acquired before it has a chance to complete a priced equity financing round, most term sheets and deal documents contain a “ change in control ” provision.

Finance 79
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Knowledge Is Power: Convertible Note Financing Terms, Part V

Gust

As we conclude our convertible note financing series, there are assorted terms commonly seen in term sheets and deal documents that are worth touching on briefly. The Note Purchase Agreement and Convertible Promissory Note are essential documents for any convertible note financing. See discussion of amendments below.)

Finance 79