Posts Tagged ‘seed financings’

Top Ten Posts in 2012

by Scott Edward Walker on January 1st, 2013

Happy New Year!  Below is a list of my top ten posts in 2012 based on pageviews.  You should also check out “Managing Startups: Best Posts of 2012,” a solid compilation by Tom Eisenmann, Professor at the Harvard Business School, of the best startup posts in 2012 (including my posts below addressing convertible notes).  Cheers, Scott

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Walker Twitter Highlights: August 22nd – September 2nd

by Scott Edward Walker on September 3rd, 2012

I’m using Twitter as a form of micro-blogging to share interesting blog posts, articles and podcasts relating to entrepreneurship and startups, M&A and legal issues.  Below are my five most popular tweets (via bit.ly) for the past ten days and a couple of blog-related tweets.  If you’d like to see all of my tweets (or an RSS feed of them), you can do so here.  Cheers, Scott

 

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Convertible Note Seed Financings: Founders Beware!

by Scott Edward Walker on May 15th, 2012

This post is the third part of a three-part primer on convertible note seed financings.  Part 1, entitled “Everything You Ever Wanted To Know About Convertible Note Seed Financings (But Were Afraid To Ask),” addressed the basics.  Part 2, entitled “Convertible Note Seed Financings: Econ 101 for Founders,” addressed the economics.  This part will address certain tricky issues.

[This post was originally published on TechCrunch.]

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Convertible Note Seed Financings: Econ 101 for Founders

by Scott Edward Walker on April 22nd, 2012

This post is the second part of a three-part primer on convertible note seed financings.  Part 1, entitled “Everything You Ever Wanted To Know About Convertible Note Seed Financings (But Were Afraid To Ask),” addressed certain basic questions, such as (i) what is a convertible note? (ii) why are convertible notes issued instead of shares of common or preferred stock? and (iii) what are the advantages of issuing convertible notes?

This part 2 will address the economics of a convertible note seed financing and the three key economic terms: (i) the conversion discount, (ii) the conversion valuation cap and (iii) the interest rate.

Part 3 will cover certain special issues, such as (i) what happens if the startup is acquired prior to the note’s conversion to equity? and (ii) what happens if the maturity date is reached prior to the note’s conversion to equity?

[Note: This post was originally published on TechCrunch.]

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Everything You Ever Wanted to Know About Convertible Note Seed Financings (But Were Afraid To Ask) – Part 1

by Scott Edward Walker on April 9th, 2012

 

 

 

 

 

 

 

 

Introduction

We are in the golden age of seed financing.  Venture capital funds, seed funds, super angels, angel groups, incubators, and “friends and family” are all playing the seed financing game and investing early in startups in an attempt to land the next Facebook.

As a result, the pendulum has swung dramatically in the founders’ favor, and the issuance of convertible notes for seed financing has never been more prolific.  Indeed, as a corporate lawyer for 18+ years, I have seen this development first-hand.

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