All Entries in the "Definitions" Category
Angel Investing: Dilution in a Down Round (Part 2)
A reader recently asked about dilution and we decided to answer it in 3 parts. Part 1 looks at dilution in an up round; this part examines dilution in a down round; and Part 3 goes over some of the measures you can take to minimize the impact and likelihood of dilution.
Here’s the question:
How do [...]
Angel Investing: Dilution in an Up Round (Part 1)
A reader writes –
How do you prevent being washed out as you keep pro-rata and the numbers get increasingly bigger?
Suppose you invest $200k for 25%. The venture then raises $5m, so to keep pro rata you do $1.25m of that round. Then it raises $15m. Eventually it gets hard to follow you money and you [...]
Term Sheet: What Da Heck Is Liquidation Preference (Part 2)
In Part 1, we answered Judd Aston’s question on liquidation preference by illustrating how it protects investors’ downside. What isn’t as obvious is that it also prevents the founders from selling early at investors’ expense.
Before you click away thinking that you got a lawyer and you don’t need to understand the terms, check out what [...]
Term Sheet: What Da Heck Is Liquidation Preference (Part 1)
Judd Aston writes -
I was asking my lawyer about liquidation preference and he bombarded me with legal jargon. Fifteen minutes later I still had not a clue what he had told me. So my question is what is liquidation preference? Some examples would be great.
Bravo. You obviously understand the benefits and convenience of understanding the [...]
Startups Creation and Tech Transfer
What’s technology transfer? Broadly speaking, it’s the process of transferring technology, knowledge, or scientific findings from research labs to commercial sectors.
Continuing last week’s conversation on tech-led economic development and research park startup companies, Brian Darmody talks about tech transfer models, the role startups play in facilitating tech transfer, favorite company success story and more.
Darmody was [...]
Do Good – Take a Look at Technology Parks Startups
Some angel investors are in it solely for the money; others are motivated to give back to the community. If you’re the type that wants to do good to the society, take a close look at research park startup companies in your region — they just might be the treasures you’ve been dying to add [...]
Martin Zwilling of Startup Professionals: Angel Investing ABC
When it comes to startup advice for tech entrepreneurs, twitterati StartupPro (a.k.a. Martin Zwilling) will probably pop up your mind.
Over the past 30 years, Zwilling has led technical business transformations, held a wide range of tech management roles, as well as done due diligence and funding analysis for investors. Though he does little investing, Zwilling [...]
Tech Startups: Exit Early via M&As
You attended a cocktail party with your friend Kenny, a seasoned angel who’s flexing his wings. During meet-and-greet Ken was approached by Jan, an upbeat entrepreneur who managed to pull off a pitch with near perfection. Ken dug her vision, energy, and character. He asked Jan, “What’s your ideal exit?” To which she replied, “Ideally, [...]
PEHub Alastair Goldfisher Part I: Intro to Private Equity
“Angel investing” is sometimes referred to as “private equity investing,” just like “angel investors” are sometimes referred to as “private equity investors.” But don’t confuse angel investing with private equity investing done by private equity firms/PE firms. Angels and PE firms invest differently, although both invest in private equities. Confused? Yah, we thought you might [...]
What the @#$ Is a “Down Round”?
The year is 1999. The economy is hot and full of excitements and opportunities. Promising dot-coms are popping up in the blink of an eye. The startup your buddy Ken invested in quickly attracted venture capital and on it went to the IPO wonderland. Ken is handing out cigars and telling you his success stories. [...]
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"You can be anything you want to be, if only you believe with sufficient conviction and act in accordance with your faith; for whatever the mind can conceive and believe, the mind can achieve."
-Napoleon Hill
