Tag: series a
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Series A Startup CEO Salary
A startup’s CEO’s $500,000 Salary Burns Startup Into Fire Sale. The Importance of Startup CEO Salary The startup community focuses most of the term sheet discussion on liquidation preferences and anti-dilution, but startup CEO salary is nonetheless an important issue. According to Peter Theil, Startup CEO salary is a predictor of a startup’s success: “The…
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What is a Fully-Diluted Basis?
The concept of a fully-diluted basis is not difficult. A fully-diluted basis just means the assumption of the highest potential amount of common stock a startup will have outstanding, regardless of vesting provisions and assuming all options and other securities like convertible notes are converted into common stock. That is, assume the highest share count…
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How to Set a Convertible Note Discount
A convertible note discount is one of the main economic levers in a convertible promissory note. Notes typically do not include a stated pre-money valuation. Instead, the note converts into equity in a later priced financing (often a Series A), and the conversion price is usually based on the price paid by new investors in…
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Preferred Stock: Where “F” in a Class Can Equal Success
If you pay any attention to TechCrunch or Venturebeat, you’ll see stories titled “Startup Raises $X Million in Y-round Financing.” When the “Y” in story is a large number, do not assume that the startup company is tanking. Instead, the startup could be gaining momentum and approaching positive cash flow…but just needs one more round…