most companies rely on interviews, which research has shown to be largely not predictive of an employee’s ultimate success in a company.

In a single-trigger provision, the founder’s stock is accelerated upon the closing of an M&A event; in a double trigger, both the closing of the deal and the acquirer’s decision not to retain the founder in the new entity are required for acceleration.

partly a spreadsheet exercise, but also includes a gut check from you as CEO to build in some cushion for things that just might not go according to plan (because nothing ever goes exactly to plan).

convertible debt is that it allows both the entrepreneur and the seed investor to punt on the question of valuation at this early stage of company development.

need to demonstrate to the VCs that you are the master of the domain you are proposing to attack

Yale wants to be able to realize its 18 percent annual return in VC by tying up its money for longer periods of time, but in order to keep funding the university and reinvesting in its venture managers, it needs to eventually get liquidity from its earlier venture investments. And, again, that drives corresponding behavior among the VC firms—they n

“Capped” notes establish a ceiling on the maximum price at which the debt will convert into equity.

meaning that they don’t have too many eggs in one basket and hold some combination of assets that might be uncorrelated with one another in case the overall investing environment moves wildly in one direction or the other.

VCs love infinite learners.