Navigating the intricacies of startup funding involves understanding a range of financial tools, and one that stands out for its adaptability and significance is the convertible note. In its technical sense, a convertible note is a debt instrument that startups use to raise capital. It’s essentially a loan that can be converted into equity (ownership…
Read article
Distribution waterfalls play an important role in determining how investment returns are distributed among stakeholders. As private investments become increasingly popular, especially in alternative asset classes like private equity, venture capital, and real estate, understanding distribution waterfalls is essential for investors and fund managers alike. In this article, we’ll delve into the concept of distribution…
Read article
I’d define what is it here and it is not required for a private company. BUT, if you have equity and are growing, it’s a good idea and a good practice to start. Are you looking for guidance on accounting for stock compensation transactions? ASC 718, also known as the Accounting Standards Codification (ASC) Subtopic…
Read article
Stock options are a powerful tool for startups to access capital, attract, retain talent, and manage equity. With the right strategy, stock options can drive significant growth and success for startup businesses. In this article, we will explore the basics of stock options in startups, their different types and legal implications, the benefits they offer,…
Read article
Introduction The cap table is an essential tool for any company, providing an overview of a business’s equity ownership and financial structure. A cap table contains critical information such as investor contributions, option pools, and dilution. Companies must have an accurate and up-to-date cap table to make informed decisions about their business. Unfortunately, many companies…
Read article
When you launch a startup, there are a lot of decisions that need to be made. One of the most critical decisions that founders must make is how to manage their stock grants. The 83(b) Election is an essential tool available to startups and founders that can help them avoid certain taxes associated with their…
Read article
If you are planning an exit from your business, you know how important it is to have everything in order. Whether selling your business, taking it public, or executing a merger, proper cap table management can make a massive difference in the transaction’s success. Cap table management involves tracking and managing all of the ownership…
Read article
Are you considering converting your LLC to a C Corporation? Before taking the leap, it’s essential to understand all of the implications and weigh your options. This article explores the process of converting from an LLC to a C Corporation, including the advantages and disadvantages, the impact on ownership rights, the tax implications, the costs…
Read article
Are you a startup looking to manage your cap table effectively? Ensuring that your equity ownership structure is accurate, organized, and secure is essential for the success of your business. Unfortunately, many startups make costly mistakes when managing their cap tables – but these mistakes can be avoided with the correct information and tools. In…
Read article
When investing in stocks, there are two primary types of inventories to consider: common and preferred. While both can be used as an investment, they have distinct advantages and disadvantages that must be considered before making a decision. This article will explore the differences between standard and preferred stock, outlining their benefits and drawbacks for…
Read article