VC Cafe

OCTOBER 31, 2022

TVPI = total value to paid in capital (paper gains) DPI = distributed to paid-in capital (real cash gains, paid out). That means that investors are contractually demanding to get 2-5x their investment, before other share classes get paid. The grey lines ( TVPI ) have never been higher relative to blue lines ( DPI ).

Founder 173

Founder Technical Review Down Round Liquidation Preference 173

Startup Lessons Learned

SEPTEMBER 12, 2013

After starting two companies of his own, he now heads the NYCDOE’s Markets initiative, which works on fostering smart demand for innovative solutions to the most urgent problems in New York’s public schools. Steven came to the NYCDOE via NASA, where he built the U.S. government’s first public website. million kids, and 135,000 employees.

Lean 162

Lean Startup Ratchet New York City 162

Tim Keane

JANUARY 12, 2010

A liquidation preference means that the investors receive their investment back (plus dividends) prior to a distribution of the proceeds to stockholders. The investor may also ask for a participation in which the investors receive some additional multiple of their investment prior to distribution of proceeds to stockholders.

Term Sheet 68

Term Sheet Valuation Dividend Liquidation Preference 68

abovethecrowd.com

APRIL 20, 2016

Examples of dirty terms include guaranteed IPO returns, ratchets, PIK Dividends, series-based M&A vetoes, and superior preferences or liquidity rights. Cash distributions are what matter at the end of the day, bug big paper gains still make for good fundraising pitches. If you over-fund the industry, aggregate returns fall.

IPO 40

IPO Term Sheet Silicon Valley Valuation 40