Both Sides of the Table

SEPTEMBER 5, 2012

Was Paul Graham right in his “high resolution” financing post? Because convertible debt deals often have both a ‘full ratchet’ and often have ‘multiple liquidation preferences’ “ Yup. You rarely find full ratchets in early-stage deals any more. Some thoughts on raising angel money.

Ratchet 354

Ratchet Liquidation Preference Equity Stock 354

Both Sides of the Table

DECEMBER 11, 2022

We had nascent revenues, ridiculous cost structures and unrealistic valuations. I learned to avoid unnecessary conferences, avoid non-essential costs and strive for at least a neutral EBITDA if for no other reason than nobody was interested in giving us any more money. Until we weren’t. Nobody cared about our valuations any more.

Valuation 466

Valuation San Francisco Ratchet Liquidation Preference 466

Startup Lessons Learned

MAY 7, 2009

As the product matured, they were able to ratchet up the quality to prevent regression on features that had been truly embraced by their customers. Starting instead from a position where feedback cycle time is the priority and allowing quality to ratchet up as the product matures provides a more natural lead in to continuous deployment.

San Francisco 131

San Francisco Continuous Deployment Software Review Lean 131

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. Truthfully.

Venture Capital 417

Venture Capital Liquidation Preference Valuation Term Sheet 417

Tim Keane

JANUARY 12, 2010

For angel groups, the distinction between groups and VCs on this issue is dwindling, especially as angel groups do bigger rounds of financing.   Note that this applies only to earl stage Series A-type equity financings and assumes no cash dividends are paid to investors.   First , dividends.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

Gust

SEPTEMBER 17, 2014

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. It’s like we need a finance 101 course for entrepreneurs.

Liquidation Preference 153

Liquidation Preference Valuation Term Sheet Stock 153

abovethecrowd.com

APRIL 20, 2016

Why the Unicorn Financing Market Just Became Dangerous…For All Involved. By the first quarter of 2016, the late-stage financing market had changed materially. Investors were becoming nervous and were no longer willing to underwrite new Unicorn-level financings at the drop of a hat. 2015 was the exact opposite.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40