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The Truth About Convertible Debt at Startups and The Hidden Terms You Didn’t Understand

Both Sides of the Table

Because convertible debt deals often have both a ‘full ratchet’ and often have ‘multiple liquidation preferences’ “ Yup. The key for entrepreneurs to understand is whether it’s a “full ratchet” or a “weighted average ratchet.” Convertible notes have full ratchets.

Ratchet 354
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Praying to the God of Valuation

Both Sides of the Table

If they are private we still have fig leaves that cover us because some rounds might raise debt vs. equity or might fund with terms like multiple liquidation preferences or full-ratchets or convertible notes with caps. But this is still all about valuations and none of it is any fun anymore.

Valuation 466
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In Q4 2022, founders face tough choices

VC Cafe

From a dinner with VC lawyers last night: – many investors switching focus to early stage – B2B saas less sexy – return of investor protective provisions including “full ratchet” – down rounds for growth companies – many bridge rounds – web3/ blockchain still going strong pic.twitter.com/ivdaMps9mM — Eze Vidra (..)

Founder 174
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6 Keys To Reducing Team Pain From Market Uncertainty

Startup Professionals Musings

Anxiety will be ratcheted up when team members see constantly changing or non-specific targets, or no guidance on how to achieve their goals. Your positivity will keep the stress level down, and the productivity level up for everyone on the team, including yourself. You will be the role model, and people will follow your lead.

Ratchet 371
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Down Rounds: Deal With Reality

Feld Thoughts

and a bunch of other things.

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Living in the Time of Covid

Feld Thoughts

The other is from The Full Ratchet and is an interview with Brian titled Breaking into VC; Excelling at Goldman Sachs; and the Origin of BLCK VC (Brian Hollins). Brian did a great job with both of them. The post Living in the Time of Covid appeared first on Feld Thoughts.

Tulsa 110
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Should I give my seed investors anti-dilution protection?

Gust

What this investor is seeking is called “permanent, full-ratchet, anti-dilution protection”, and that is neither (a) in line with the market, nor (b) practical.

Dilution 137