Keeping your slice of the pie - The Startup Founder's Guide to Equity - Part II
Yin Wufemstreet.substack.com
Saved by Danielle Vermeer
Keeping your slice of the pie - The Startup Founder's Guide to Equity - Part II
"What's the preference stack?" Silence. Here's what that 1% actually means: - Investors put in $10M - They get paid back 2x first - Then they get their pro-rata - Then you get... what's left The real math: $20M exit = $0 for you $30M exit = $0 for you $40M exit = maybe lunch money But it gets worse: Your 1% isn't even 1%: - Series A cuts it to 0.5%... See more
Paul Venuto • feed updates
Questions to ask about your equity:
About the round structure: Was it raised at a single price or in tranches? What did the lead pay versus other participants? What percentage of the round came in at the headline valuation?
About your negotiating position: Given valuation risk, can I get more shares? Can I take more cash and less equity? Is early... See more
About the round structure: Was it raised at a single price or in tranches? What did the lead pay versus other participants? What percentage of the round came in at the headline valuation?
About your negotiating position: Given valuation risk, can I get more shares? Can I take more cash and less equity? Is early... See more
Liar's Valuation
Investing
Simple Agreement for Future Equity (SAFE)
A SAFE gives investors the rights to purchase stock in a future equity round, often with a specific cap and/or discount. No specific price per share is determined at the time of the initial investment.
They’re a simple and fast way to get early investments into a company. The SAFE was originally
... See more