#startups

How to Properly Raise Seed Capital from Family & Friends

In my last post we ran through a scenario where a founder excitedly decided to sell equity to her uncle, an unsophisticated investor. That decision led to the unintended consequences of inflating the value of the company’s stock at an early stage as well as creating a giant tax liability [...]

By |July 2nd, 2019|Categories: Fundraising, Investors|Tags: , , |0 Comments

The dangers of selling equity to friends and family for early stage startups

You just received an email from your rich uncle who normally invests in real estate. He is excited about your company and wants to put in $25k for 0.1% of your company, your first outside capital. That gives you a pre-money valuation of $25M! So everything is great, right? Cue [...]

By |June 21st, 2019|Categories: Cap Table Management, Fundraising|Tags: , , , , |0 Comments

Should you hire an independent contractor or an employee?

The short answer of course is – it depends. A founder must balance the following needs: Responsiveness Cash burn Ability to control and command Administrative burden Culture & commitment. This blog post isn't a technical one about the nuances about the law - we'll get into that in future posts [...]

Non-competes 101

As a startup founder you should be aware that executing a contract containing non-compete and non-solicit language with your team member is an excellent way to protect your company. This post focuses on non-compete provisions. What restrictions are created by non-compete/non-solicit provisions? At a high level the non-compete language restricts [...]

Your Startup’s Initial Investors – Up to Series Seed

tl;dr - A high-growth startup will likely eventually need outside capital. Family and friends invest in companies when they are little more than an idea. Angels invest when the startup starts to gain traction. Traditional accelerators invest cash as well as resources for a piece of equity. Seed funds write [...]

What is the forgotten founder problem? How to avoid or fix this issue.

tl:dr - A forgotten founder is someone who initially works on the product of a company, never assigns his IP to the company, and re-appears when the company is looking at exit event. The best way to handle this issue is by avoiding it by having them sign an IP [...]

How to Properly Raise Seed Capital from Family & Friends

In my last post we ran through a scenario where a founder excitedly decided to sell equity to her uncle, an unsophisticated investor. That decision led to the unintended consequences of inflating the value of the company’s stock at an early stage as well as creating a giant tax liability [...]

By |July 2nd, 2019|Categories: Fundraising, Investors|Tags: , , |0 Comments

The dangers of selling equity to friends and family for early stage startups

You just received an email from your rich uncle who normally invests in real estate. He is excited about your company and wants to put in $25k for 0.1% of your company, your first outside capital. That gives you a pre-money valuation of $25M! So everything is great, right? Cue [...]

By |June 21st, 2019|Categories: Cap Table Management, Fundraising|Tags: , , , , |0 Comments

Should you hire an independent contractor or an employee?

The short answer of course is – it depends. A founder must balance the following needs: Responsiveness Cash burn Ability to control and command Administrative burden Culture & commitment. This blog post isn't a technical one about the nuances about the law - we'll get into that in future posts [...]

Non-competes 101

As a startup founder you should be aware that executing a contract containing non-compete and non-solicit language with your team member is an excellent way to protect your company. This post focuses on non-compete provisions. What restrictions are created by non-compete/non-solicit provisions? At a high level the non-compete language restricts [...]

Your Startup’s Initial Investors – Up to Series Seed

tl;dr - A high-growth startup will likely eventually need outside capital. Family and friends invest in companies when they are little more than an idea. Angels invest when the startup starts to gain traction. Traditional accelerators invest cash as well as resources for a piece of equity. Seed funds write [...]

What is the forgotten founder problem? How to avoid or fix this issue.

tl:dr - A forgotten founder is someone who initially works on the product of a company, never assigns his IP to the company, and re-appears when the company is looking at exit event. The best way to handle this issue is by avoiding it by having them sign an IP [...]

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