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Startup Lawyer helps educate entrepreneurs about the legal aspects of the startup process, including incorporation, seed financings, venture capital and exit transactions
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Price Cap Liquidation Preference Windfall Regulators
Most convertible notes have a price cap as a feature term. Depending on the delta between the price cap and the pre-money valuation of the qualified equity financing, the convertible note investors could receive a windfall in terms of liquidation preference. The Potential Problem Let’s say Series A investors invest at a pre-money valuation that [...]
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Tech Wildcatters Spring 2013 Applications Are Open
Tech Wildcatters, a Forbes Top 10 seed accelerator, is now accepting applications for the fifth cycle of their 12-week accelerator program which begins Spring 2013. The deadline for submissions is January 21, 2013. Comprised of 15 startups, the fifth cycle is set up to be the largest group of companies to go through the Tech [...]
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Convertible Note Transaction Documents
It’s a common misconception that the ‘convertible note’ is the only legal document used in a convertible debt financing. I often receive emails from entrepreneurs asking for a ‘sample convertible note’ which I assume they are planning to use on their own. In addition to the convertible note, a startup will also need to draft [...]
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