Comments on: Preferred Stock: Where “F” in a Class Can Equal Success http://startuplawyer.com/preferred-stock/preferred-stock-where-f-in-a-class-can-equal-success Startup Law, Incorporation, Convertible Notes, Preferred Stock, Stock Options, Venture Capital Sun, 22 Jan 2012 19:35:50 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Ryan Roberts http://startuplawyer.com/preferred-stock/preferred-stock-where-f-in-a-class-can-equal-success#comment-297 Ryan Roberts Mon, 15 Dec 2008 17:01:35 +0000 http://www.thestartuplawyer.com/?p=621#comment-297 I agree. And we'll probably see a lot of that (common taking big hits) given the lower valuations going around. I agree. And we'll probably see a lot of that (common taking big hits) given the lower valuations going around.

]]> By: Ryan Roberts http://startuplawyer.com/preferred-stock/preferred-stock-where-f-in-a-class-can-equal-success#comment-2639 Ryan Roberts Mon, 15 Dec 2008 17:01:00 +0000 http://www.thestartuplawyer.com/?p=621#comment-2639 I agree. And we'll probably see a lot of that (common taking big hits) given the lower valuations going around. I agree. And we'll probably see a lot of that (common taking big hits) given the lower valuations going around.

]]> By: FN http://startuplawyer.com/preferred-stock/preferred-stock-where-f-in-a-class-can-equal-success#comment-298 FN Sat, 29 Nov 2008 11:39:20 +0000 http://www.thestartuplawyer.com/?p=621#comment-298 True, companies often survive through an E-, F- or later round, but as you know, Common usually gets wiped out after the 3rd or maybe the 4th round. Even if they're not completely wiped out, Common is under such a large preference stack that they might as well be. The fact that startups last through these later rounds is mostly the result of a perverse incentive the VCs have (they're playing with other people's money and they get 20% of any upside so hope is always around the corner). True, companies often survive through an E-, F- or later round, but as you know, Common usually gets wiped out after the 3rd or maybe the 4th round. Even if they're not completely wiped out, Common is under such a large preference stack that they might as well be.

The fact that startups last through these later rounds is mostly the result of a perverse incentive the VCs have (they're playing with other people's money and they get 20% of any upside so hope is always around the corner).

]]> By: FN http://startuplawyer.com/preferred-stock/preferred-stock-where-f-in-a-class-can-equal-success#comment-2640 FN Sat, 29 Nov 2008 11:39:00 +0000 http://www.thestartuplawyer.com/?p=621#comment-2640 True, companies often survive through an E-, F- or later round, but as you know, Common usually gets wiped out after the 3rd or maybe the 4th round. Even if they're not completely wiped out, Common is under such a large preference stack that they might as well be. The fact that startups last through these later rounds is mostly the result of a perverse incentive the VCs have (they're playing with other people's money and they get 20% of any upside so hope is always around the corner). True, companies often survive through an E-, F- or later round, but as you know, Common usually gets wiped out after the 3rd or maybe the 4th round. Even if they're not completely wiped out, Common is under such a large preference stack that they might as well be.

The fact that startups last through these later rounds is mostly the result of a perverse incentive the VCs have (they're playing with other people's money and they get 20% of any upside so hope is always around the corner).

]]>