YoungUpstarts
APRIL 16, 2020
If the situation is dire, you may also consider recapitalizing the business through a debt refinancing or by selling equity. See if you and your finance staff can answer these questions: When did my business become unprofitable, and what caused the change? How do I Turnaround an Unprofitable Business? What are my top 3 costs?
Steve Blank
APRIL 26, 2022
For existing investors, sometimes it was a “pay-to-play” i.e. if you don’t participate in the new financing you lose. A down round is when a company raises money at valuation that is lower than the company’s valuation in its prior financing round. Other times it was simply a take-it-or-leave-it, here are the new terms.
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David Teten
JANUARY 19, 2021
When the company hits potholes, Flexible VC investors usually don’t have the nuclear options of firing management and/or doing a recapitalization. Part of the magic of revenue-based financing is how historical performance and strong, achievable financial projections are ultimately the backbone of how RBI/RBF investment decisions are made.”
philipsmith.typepad.com
SEPTEMBER 24, 2011
a year burn rate and your equity is worthless due to numerous recapitalizations and bridge loans from investors then either you don't get it or I'm stupid to do it. The second example came along just this morning. Someone in my network forwarded an email to me from a recruiting firm that is quite active in the Valley.
venturehacks.com
MARCH 21, 2008
The company is acquired, recapitalized, or otherwise restructured and the advisors are no longer useful or desired. Or you can just “burn the boats at the shore&# and give the advisory shares to the investor with the agreement that he will invest a minimum amount in the financing. Should I give advisory shares to my investors?
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. This is uncharted territory.
Feld Thoughts
JULY 14, 2015
Assuming equity is raised at or above that cap, the total dilution, before the new money, is 16.6% (equivalent to an equity financing of $1m at a $6m post money valuation. So they recapitalize the company. A company raises $1m of seed money from angels in a convertible note with a $6m cap.
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