Venture Deals
John Wiley & Sons Inc (Hersteller)
978-1-119-25979-4 (ISBN)
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This is the highly anticipated third edition of the best-selling book which has become the definitive resource for understanding venture capital fundraising. Whether you are an entrepreneur, lawyer, student or just have an interest in the venture capital ecosystem, Venture Deals is for you. The book dives deeply into how deals are constructed, why certain terms matter (and others don’t), and more importantly, what motivates venture capitalists to propose certain outcomes. You’ll see the process of negotiating from the eyes of two seasoned venture capitalists who have over 40 years of investing experience as VCs, LPs, angels, and founders. They will teach you how to develop a fundraising strategy that will be a win for all parties involved.
This book is designed to bring transparency to the venture capital funding process and includes such topics as:
How to raise money;
What terms matter and which ones don’t;
How to negotiate a fair deal for everyone;
What makes venture capitalists tick, including how they are compensated and motivated;
How companies are valued by venture capitalists;
How all current structures of funding work, including convertible debt, crowdfunding, pre-sales and other non-traditional methods;
How these particular issues change through different stages of financing (seed, early, mid and late); and
How to avoid business and legal pitfalls that many entrepreneurs make.
And as in the previous editions, this book isn’t just a one-sided opinion from venture capitalists, but also has helpful commentary throughout from a veteran CEO who has raised many rounds of financing from many different investors.
If you are ready to learn all the secrets and ins and outs of fundraising, Venture Deals is an essential read.
BRAD FELD has been an early-stage investor and entrepreneur for over twenty-five years. Prior to co-founding Foundry Groupa Boulder, Colorado-based venture capital firmhe co-founded Mobius Venture Capital. Brad also founded Intensity Ventures, a company that helped launch and operate software companies. Prior to this, Brad founded Feld Technologies. He is also a founder of Techstars and has been active with non-profit organizations, including acting as chairperson for the National Center for Women in Technology. JASON MENDELSON has 20 years of experience in the venture industry. Prior to co-founding Foundry Group, Jason was a Managing Director and Chief Administrative officer at Mobius Venture Capital, where he also served as the firm's general counsel. Besides his experience as a venture investor, Jason has also been a software engineer, startup lawyer, and a co-founder of SRS | Acquiom. He is an adjunct at the University of Colorado Law School where he co-teaches a course on venture capital and entrepreneurship.
Foreword xiii
Fred Wilson
Foreword xv
James Park
Preface xvii
Acknowledgments xxiii
Introduction: The Art of the Term Sheet 1
Chapter 1 The Players 5
The Entrepreneur 5
The Venture Capitalist 6
Financing Round Nomenclature 9
Types of Venture Capital Firms 10
The Angel Investor 11
The Syndicate 13
The Lawyer 14
The Mentor 16
Chapter 2 How to Raise Money 19
Do or Do Not—There is No Try 19
Determine How Much You are Raising 20
Fundraising Materials 21
Due Diligence Materials 28
Finding the Right VC 28
Finding a Lead VC 30
How VCs Decide to Invest 31
Using Multiple VCs to Create Competition 34
Closing the Deal 35
Chapter 3 Overview of the Term Sheet 37
The Key Concepts: Economics and Control 38
Chapter 4 Economic Terms of the Term Sheet 39
Price 39
Liquidation Preference 45
Pay-to-Play 53
Vesting 56
Exercise Period 60
Employee Pool 61
Antidilution 63
Chapter 5 Control Terms of the Term Sheet 67
Board of Directors 67
Protective Provisions 70
Drag-Along Agreement 74
Conversion 77
Chapter 6 Other Terms of the Term Sheet 81
Dividends 81
Redemption Rights 83
Conditions Precedent to Financing 85
Information Rights 87
Registration Rights 88
Right of First Refusal 91
Voting Rights 92
Restriction on Sales 92
Proprietary Information and Inventions Agreement 93
Co-Sale Agreement 94
Founders’ Activities 95
Initial Public Offering Shares Purchase 96
No-Shop Agreement 97
Indemnification 100
Assignment 101
Chapter 7 The Capitalization Table 103
Chapter 8 Convertible Debt 107
Arguments For and Against Convertible Debt 108
The Discount 110
Valuation Caps 111
Interest Rate 112
Conversion Mechanics 113
Conversion in a Sale of the Company 115
Warrants 116
Other Terms 118
Early-Stage versus Late-Stage Dynamics 119
Can Convertible Debt Be Dangerous? 120
An Alternative to Convertible Debt 121
Chapter 9 Crowdfunding 123
Product Crowdfunding 123
Equity Crowdfunding 125
How Equity Crowdfunding Differs 127
Chapter 10 How Venture Capital Funds Work 129
Overview of a Typical Structure 129
How Firms Raise Money 131
How Venture Capitalists Make Money 132
How Time Impacts Fund Activity 136
Reserves 138
Cash Flow 140
Cross-Fund Investing 141
Departing Partners 141
Corporate Venture Capital 142
Strategic Investors 144
Fiduciary Duties 145
Implications for the Entrepreneur 146
Chapter 11 Negotiation Tactics 147
What Really Matters? 147
Preparing for the Negotiation 148
A Brief Introduction to Game Theory 150
Negotiating in the Game of Financings 152
Negotiating Styles and Approaches 154
Collaborative Negotiation versus Walk-Away Threats 156
Building Leverage and Getting to Yes 158
Things Not to Do 160
Great Lawyers versus Bad Lawyers versus No Lawyers 162
Can You Make a Bad Deal Better? 163
Chapter 12 Raising Money the Right Way 165
Don’t Be a Machine 165
Don’t Ask for a Nondisclosure Agreement 166
Don’t Email Carpet Bomb VCs 166
No Often Means No 166
Don’t Ask for a Referral If You Get a No 167
Don’t Be a Solo Founder 168
Don’t Overemphasize Patents 168
Chapter 13 Issues at Different Financing Stages 171
Seed Deals 171
Early Stage 172
Mid and Late Stages 173
Chapter 14 Letters of Intent—The Other Term Sheet 175
Structure of a Deal 176
Asset Deal versus Stock Deal 179
Form of Consideration 181
Assumption of Stock Options 182
Representations, Warranties, and Indemnification 186
Escrow 187
Confidentiality/Nondisclosure Agreement 189
Employee Matters 189
Conditions to Close 191
The No-Shop Clause 191
Fees, Fees, and More Fees 193
Registration Rights 193
Shareholder Representatives 194
Chapter 15 Why Do Term Sheets Even Exist? 197
Constraining Behavior and the Alignment of Incentives 198
Transaction Costs 199
Agency Costs and Information Asymmetry 200
Reputation Constraints 201
Chapter 16 Legal Things Every Entrepreneur Should Know 203
Intellectual Property 203
Employment Issues 205
State of Incorporation 206
Type of Corporate Structure 207
Accredited Investors 207
Filing an 83(b) Election 208
Section 409A Valuations 209
Authors’ Note 211
Appendix A: Sample Term Sheet 213
Appendix B: Sample Letter of Intent 223
Appendix C: Additional Resources 231
Foreword to the First and Second Editions 235
Glossary 237
About the Authors 247
Index 249
Excerpt from Startup Communities 261
| Erscheint lt. Verlag | 26.11.2016 |
|---|---|
| Verlagsort | New York |
| Sprache | englisch |
| Themenwelt | Wirtschaft ► Betriebswirtschaft / Management ► Finanzierung |
| ISBN-10 | 1-119-25979-7 / 1119259797 |
| ISBN-13 | 978-1-119-25979-4 / 9781119259794 |
| Zustand | Neuware |
| Informationen gemäß Produktsicherheitsverordnung (GPSR) | |
| Haben Sie eine Frage zum Produkt? |
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