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The Truth About Convertible Debt at Startups and The Hidden Terms You Didn’t Understand

Both Sides of the Table

This time by the efforts of Adeo Ressi to introduce a new kind of structure called “ convertible equity.” My initial reaction to Adeo when we spoke was that while it may have solved some issues (debt versus equity) it didn’t solve the ones that I’ve been warning entrepreneurs about most loudly.

Startup 355
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5 Steps To Reduce Due Diligence Investment Failures

Startup Professionals Musings

Set up an interview room, stocked with current docs. Startup equity investments imply a long-term business relationship, lasting five years or longer. You need to brief the investor early if there are organizational or people changes that are in process, or conflicts that may become apparent during the due diligence visits.

Invest 59
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Bad Notes on Venture Capital

Both Sides of the Table

At an accelerator … Me: Raising convertible notes as a seed round is one of the biggest disservices our industry has done to entrepreneurs since 2001-2003 when there were “full ratchets” and “multiple liquidation preferences” – the most hostile terms anybody found in term sheets 10 years ago. Your A round?

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One Man’s Signal is Another Man’s Noise

Both Sides of the Table

I was thinking back to a few previous “insider baseball&# blog debates that raged for several weeks: AngelGate (aka Bin38 secret cabal), convertible debt vs. equity, bubble vs. not, and now the AngelList discussion. It sure wasn’t when I was a first-time entrepreneur. But to entrepreneurs can be gold. Same thing.

Email 287
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Why you should never have a data room — the most counter-intuitive fund-raising advice you’ll ever…

Both Sides of the Table

If you’ve got the skills to be a strong entrepreneur then it shouldn’t be too difficult to find people who know a partner at a VC firm and if you can build relationship with them you can get introduced. Most entrepreneurs (and VCs raising from LPs) think this means progress. Entrepreneur : “Sure. Some people find this elitist?—?I

Funding 336