Preparing for Funding Overview
May 9, 2018 | By Vela Wood
Office Hours is a podcast hosted by Vela Wood venture attorneys Kevin Vela and Aaron Terwey covering general issues related to small businesses and startups. Preparing For Funding is a series of Office Hours episodes about getting your company’s legal house in order before taking on funding.
- In this episode, Kevin and Aaron discuss why your company’s legal matters, lifestyle businesses v. venture-backed businesses, whether you should form your entity as a corporation or LLC, implications of the new tax code, and the filing requirements for entity formation.
- In this episode, we discuss the difference between vesting and reverse vesting, confidentiality agreements and assignment of intellectual property, restricted stock and 83(b) elections, ROFR, and Class F founders stock.
- In this episode, we discuss how to mitigate the risks of Friends & Family funding, which include disproportionate valuations, violating SEC and state securities laws, and messy cap tables.
- In this episode, we discuss what makes a great pitch deck, the best uses of an appendix, how to get warm introductions to investors, and restrictions on general solicitations.
- In this episode, we discuss qualifications for accredited investors, how to find angel investors, how angel syndicates work, which metrics you need to know for a pitch meeting, and how to respond to getting a “no.”
- In this episode, we discuss why we’re not big fans of accelerators, the types of accelerators we do think provide value and are worth participating in, and the clauses to watch out for in an accelerator’s program participation agreement.
- In this episode, we discuss what constitutes a seed round in Dallas and contrast the three potential structures of a seed round – equity, convertible note, and a SAFE.