Mar 122012
 
Getting Ready for Due Diligence

Is your startup ready to take on outside investors?  For many startups, the knee-jerk reaction is often “sure,” but be careful: sophisticated investors will want to take a rather invasive look through your company to make sure that they’re not investing in a dog. Prepare for an uncomfortable inquiry. Before that inquiry happens, it’s well worth the effort to find and fix problems that are going to arise in that Due Diligence review anyway.  Not [...]

Mar 272011
 

Our company needs more money to operate, but we don’t want to put in more of our own money and don’t want to take out a bank loan.  Can’t we just sell more stock? Of course you can.  But, that transaction is a lot more complicated than just accepting a check and printing a stock certificate. Among other things, there are legal requirements for (1) who sales or offers can be made to, (2) what [...]

Feb 282011
 

Figuring out how to divvy up a new company’s stock among its founders is often the first thing those founders have to work through.  Part of the discussion is always some variant of “what happens if we go two months down the road and one of us pulls out”?  And, the answer to that is always vesting — the founder gets the stock now, but the company can buy all, or part, of it back [...]