Venture Deals

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Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist is the definitive guide to venture financings. This book is for anyone who wants the insider’s guide to raising money, negotiating deals, and to know what really makes venture capitalists tick.

Venture Deals: Chapter 13: Legal Things Every Entrepreneur Should Know

There are a few legal issues that we’ve seen consistently become hurdles for entrepreneurs and their lawyers. While in some cases they will simply be a hassle to clean up in a financing or an exit, they often have meaningful financial implications for the company and, in the worst case, can seriously damage the value…

Venture Deals: Chapter 12: Letters of Intent—The Other Term Sheet

There is another type of term sheet that is important in an entrepreneur’s life—the letter of intent (LOI). Hopefully, one day you’ll receive one from a potential acquirer that will lead to fame, riches, and happiness. Or at least you’ll get a new business card on heavier card stock. Typically the first formal step by…

Venture Deals: Chapter 11: Issues at Different Financing Stages

As we enter the home stretch of the book, we spend some time talking about financings at different stages of the life of a company. Not all financings are created equal. This is especially true when you factor in the different stages that your company will evolve through over its lifetime. Each financing stage—seed, early,…

Errata For Venture Deals

Every book we’ve ever read has mistakes in it. Ours is no exception. We tried hard to get everything right, and say it clearly, but we know some errors snuck in. We’ve created an Errata page on this site. Whenever we find an error, or someone reports a mistake, we’ll put it up on the…

Venture Deals: Chapter 10: Raising Money the Right Way

While most people ask themselves “What should I do?” when seeking VC financing, there are also some things that a person should not do. Doing any of the following at best makes you look like a rookie (which is okay, we all were rookies once) and at worst kills any chance that you have of…

Venture Deals: Chapter 9: Negotiation Tactics

Regardless of how much you know about term sheets, you still need to be able to negotiate a good deal. We’ve found that most people, including many lawyers, are weak negotiators. Fortunately for our portfolio company executives, they can read about everything we know online and in this book, so hopefully in addition to being…

Venture Deals: Chapter 8: How Venture Capital Funds Work

Before we talk about the dynamics of the negotiation of the deal, it’s useful to understand the motivation of the person you’ll be negotiating against, namely the venture capitalist (VC). We’ve been asked many times to divulge the deep, dark secrets of what makes VCs tick. One night over dinner we talked through much of…

Venture Deals: Chapter 7: The Capitalization Table

Now is your chance to show off their proficiency with a spreadsheet. Even if you know what a cap table is, we’ll give you a simple way to calculate the summary level ownership categories with a calculator (or a simple spreadsheet model).  Now that we’ve worked through all of the specific clauses in the term…

Venture Deals: Chapter 6: Other Terms of the Term Sheet

In this chapter we cover the non-economic and non-control terms in the term sheet. Some matter, some don’t, and context matters a lot. Hopefully we’ll give you plenty of it to use in your negotiation with your venture capitalist. Up to this point we’ve been exploring terms that matter a lot and fall under the…