VCs who care about dividens either is a private equity guy or is focused on downside protection on larger deals
Ensuring dividends have to be approved by a majority of BoD
VCs focused on these for add-on downside protection. Redemption rights allow investor a guaranteed exit, for example, in a case of a company will become successfully enough to be an ongoing business but not enough for IPO or liquidize.
Avoid CPF as much as possible
Three conditions to watch out for: 1. Approval by Investors’ Partnerships 2. Rights offering to be completed by company 3. Employment agreements signed by founders as acceptable to investors.
A VC who won’t spell out key employment terms at the beginning is a big red flag.
Remember: you don’t necessarily have a deal just because you’ve signed a term sheet.
Run a transparent organization rather than spending time on this shit
The world is good if you’re going public.
Also know as pro rata right. > Make sure shareholders get this right only if they play in subsequent rounds
Relationship between Preferred Stock and the Common Stock in the context of a share vote.
Also known as the right of first refusal on sales of common stock (ROFR on common).
If founder are actually working on something else at the same time and don’t disclose it, this term is violated.
Nice problem to have
Basically insurance policy