venturehacks.com

OCTOBER 21, 2010

SUPPORTED BY Products Archives @venturehacks Books AngelList About RSS The Option Pool Shuffle by Nivi on April 10th, 2007 “Follow the money card!&# – The Inside Man, Three-Card Shuffle Summary: Don’t let your investors determine the size of the option pool for you. Don’t lose this game. share to $1.00/share:

Option Pool 68

Option Pool Pre-Money Valuation Dilution Warrant 68

Both Sides of the Table

NOVEMBER 4, 2009

When I was CEO of my first company (where I admittedly F’d up everything before I figured it all out) we initially calculated for people how much there options were going to be worth some day. When we next spoke he had found out that the CEO had about 5% and there was no management option pool in place.

Stock Options 418

Stock Options Stock Liquidation Preference Option Pool 418

David Teten

DECEMBER 3, 2019

But in business, you want a lot of partners. In the private equity universe, most Partners have primary training as deal-makers, not as managers. See Bessemer Venture Partners’ A comprehensive guide to security for startups. Cobalt for General Partners helps GPs to optimize their fundraising strategy. 1) Manage the firm

Technical Review 78

Technical Review Software Review Analytics Private Equity 78

www.paulgraham.com

APRIL 28, 2010

The fund managers, who are called"general partners," get about 2% of the fund annually as a managementfee, plus about 20% of the funds gains. Not all the people who work at VC firms are partners. If you get a call from a VCfirm, go to their web site and check whether the person you talkedto is a partner.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

thinkspace.com

SEPTEMBER 7, 2012

Chris Dixon wrote a blog post about “ The one number you should know about your equity grant “ The one number you should know about your equity grant is the percent of the company you are being granted (in options, shares, whatever – it doesn’t matter – just the % matters). Percent of the outstanding option pool: meaningless.

Equity 62

Equity Employee Founder CTO Hire 62

www.readwriteweb.com

DECEMBER 29, 2011

If you're early in the investment process, a small angel round or partnering with an accelerator may be the best approach. Next, if you are going to raise a round, find one or two partners to do it with. In fact, research conducted by the Startup Genome Project found that the best practice in the first phase, a.ka.

Cap Table 47

Cap Table Term Sheet Liquidation Preference Technical Review 47

www.inc.com

SEPTEMBER 24, 2011

Durkin , managing partner with the Boston -based law firm Lucash, Gesmer & Updegrove LLP. Chip Morse , cofounder and partner with Morse, Barnes-Brown & Pendleton P.C., Create an options pool, if nothing more than in your mind, so you have some parameters to work within," Durkin says. based in Waltham, Mass. Two trucks.

Fractional CTO 40

Fractional CTO Equity Iowa Technical Cofounder 40

The Next Web

OCTOBER 21, 2013

Neil Rimer is a Partner and co-founder of Index Ventures. More often than not, these companies have no formal option pool, although many have either formal or informal promises to grant options to key employees.

Cap Table 128

Cap Table Option Pool Angel Investor Entrepreneur 128

www.paulgraham.com

OCTOBER 23, 2010

If we assumethe average startup runs for 6 years and a partner can bear to beon 12 boards at once, then a VC fund can do 2 series A deals perpartner per year. 13 ]Im not saying option pools themselves will go away. The stickingpoint is board seats. It has always seemed to me the solution is to take fewer boardseats.

Startup 93

Startup Valuation Non-Compete Deal Flow 93

Both Sides of the Table

FEBRUARY 22, 2011

Let’s say each of those 5 partners has at least 7 other investments each. The most common case is that the partner who did the deal left the firm. When you consider that they’ll also want a 15-20% option pool in the company you’re talking about founders owning as little as 40% after just one round.

Dilution 314

Dilution Cap Table Due Diligence Option Pool 314

Pascal's View

JULY 9, 2017

Company Y receives an offer from an angel or ‘unsophisticated’ smaller VC fund that is unwilling to lead and price the equity but wants to ‘invest now’.

Post-Money Valuation 49

Post-Money Valuation Valuation Covenant Cap Table 49

The Equity Kicker

OCTOBER 8, 2014

We have taken their feedback and tweaked the termsheet as appropriate with the result that on all terms bar valuation, option pool and details of founder vesting our termsheet is now, in effect, very close to fully negotiated before we send it to companies. Forward Partners Venture Capital'

Founder Vesting 92

Founder Vesting Vesting Option Pool Institutional Investors 92

Professor VC

JANUARY 17, 2008

A partner from the law firm (sponsor, covers the drinks and food) tosses out some softball questions to the panelists, the audience chimes in with Q&A and finally, culminates with the meet and greet where the panelists are flooded with business cards and pitches on the next great thing, which is often very similar to the last great thing.

Pre-Money Valuation 28

Pre-Money Valuation Angel Investor Angel Groups Valuation 28

The Equity Kicker

OCTOBER 8, 2014

We have taken their feedback and tweaked the termsheet as appropriate with the result that on all terms bar valuation, option pool and details of founder vesting our termsheet is now, in effect, very close to fully negotiated before we send it to companies. Forward Partners Venture Capital'

Founder Vesting 68

Founder Vesting Vesting Option Pool Institutional Investors 68

Early Growth Financial Services

JUNE 26, 2014

Baze, Partner at Partech Ventures, Carlos Diaz, CEO at Kwarter, and EGFS’ Chief Strategy Officer Glenn McCrae covered raising funds, how-to pitch VCs, and potential sticking points around valuation. Option Pool — An important piece of your hiring and compensation … Continue reading → Videos'

Pre-Money Valuation 51

Pre-Money Valuation Option Pool Dilution Common Stock 51

Berkonomics

SEPTEMBER 28, 2017

Here’s an example: First, a brand-new enterprise is often formed from the efforts of several “partners”, each with an expertise valued by the others. Inducing a new CEO to come aboard usually means creation of a stock option package of 5-8%. That size of grant would take much or most of the option pool.

Early Stage 102

Early Stage Equity Stock Options Vesting 102

The Equity Kicker

APRIL 10, 2015

We’ve just been writing an update for investors about the progress our partner companies have been making. Note: if the option pool has been increased between rounds this will have the effect of reducing the increase in share price and should be factored into the analysis. Venice Project'

Valuation 60

Valuation Pre-Money Valuation Post-Money Valuation Option Pool 60

Berkonomics

MAY 12, 2010

Inducing a new CEO to come aboard usually means creation of a stock option package of 5-8%. That size of grant would take much or most of the option pool. All other grants usually are much lower, allowing for the typical 15% pool to last for quite awhile in most companies.

Early Stage 85

Early Stage Equity Stock Options Vesting 85

This is going to be BIG.

AUGUST 21, 2023

It’s this part: “I’m getting inbound from investors…” Nearly all of the inbound VC interest happening out there is from non-partner investors (i.e. A check-writing partner reaches out to you. Here’s the option pool that I think fairly incentivizes you. What does real excitement look like?

Cap Table 78

Cap Table Term Sheet Database Option Pool 78

www.instigatorblog.com

OCTOBER 23, 2010

You can’t have an option pool that takes up 50% of the company’s shares, and you have to leave room for future employees as well. blog comments powered by Disqus About Ben Yoskovitz Im a Founding Partner at Year One Labs , an early stage accelerator in Montreal. They need a shot at a pot of gold.

Equity 41

Equity Employee Startup Vesting 41

www.paulgraham.com

OCTOBER 23, 2010

And they make a lot more investmentsper partner than VCs—up to 10 times as many. 3 ] Because super-angels make more investments per partner, they haveless partner per investment. It will vary enormously from one partner to another. Thechance of getting rejected after the full partner meeting averagesabout 25%.

Valuation 92

Valuation Stock Partner Founder 92

Scott Edward Walker

AUGUST 31, 2011

He will also help diligence the investors to make sure you choose the right partner for your startup. Moreover, he will impress upon you the importance of talking to other investors (if you haven’t already done so) in order to create a competitive environment. Simply put, how is the investor’s lawyer going to play this role?

Silicon Valley 45

Silicon Valley Term Sheet Liquidation Preference Redemption 45

Berkonomics

NOVEMBER 23, 2023

and here is the usual early-stage trap… First, a brand-new enterprise is often formed from the efforts of several “partners”, each with an expertise valued by the others. Inducing a new CEO to come aboard usually means creation of a stock option package of 5-8%. That size of grant would take much or most of the option pool.

Equity 62

Equity Stock Options Vesting Early Stage 62

Rob Go

AUGUST 29, 2016

Founders also had to do a little math on the new option pool to really understand what their ownership would be post investment, since it was typically taken out of the company pre-money. Most term sheets talked about the valuation in these terms, and you added the dollars invested to get a post-money valuation.

Post-Money Valuation 52

Post-Money Valuation Valuation Cap Table Term Sheet 52

www.mattbartus.com

DECEMBER 9, 2012

You have a 20% option pool, so you know this will take your ownership down from 80% to 60%, and the VC will get 25%. Option Pool. Option Pool. Let’s say you receive a term sheet for a $1 million investment at a $3 million fully diluted pre-money valuation, and you’re kind of disappointed.

Warrant 40

Warrant Valuation Pre-Money Valuation Term Sheet 40

thestartuplawyer.com

FEBRUARY 24, 2010

Your Business Partner Closer,&# was a reformatted version of a blog post titled “Keep Your Startup Co-Founder Closer&# which appeared in Ryan Roberts PC’s blog for startups and entrepreneurs, The Startup [.] He obviously never launched a startup and got shafted by a co-founder.

Cofounder 40

Cofounder Founder Preferred Stock Startup 40

venturehacks.com

SEPTEMBER 22, 2011

The top firms are mainly in the business of making money for their limited partners by picking the startups that are going to succeed with or without their value add. The Option Pool Shuffle. But entrepreneurs should understand that the top firms pick the best companies, they don’t make the best companies. Popular Posts.

Equity 40

Equity Cap Table Valuation RSS 40

The Next Web

AUGUST 14, 2013

You’ll hear terminology getting bandied about left and right about things like convertible notes, capped vs. uncapped, stock option pools, board observer rights, maturity dates, priced equity. I was lucky enough to have Y Combinator, the partners, and my batchmates walk me through a lot of this.

Founder 142

Founder Incubator Cofounder Accredited Investor 142

Both Sides of the Table

SEPTEMBER 1, 2011

Every corporate transaction you’ll do will require somebody to help you to: Think through the options, negotiation terms, get other investors on board, talk with new investors/partners/companies you’re acquiring, etc. That’s what they’ll be saying to other VCs or their partners as your company is flaming out.

Strategic Investors 312

Strategic Investors Los Angeles Cap Table Startup 312