Accounting

Do Venture Capitalists Demand Audited Financials?

Q:  Do venture capitalists require audited financials from the companies they’re considering for an investment?  Will “reviewed” financials suffice?  For that matter, how do acquirers think about audited financials?  Will they help speed an acquisition or is it overkill? A: (From guest writer, our partner, Chris Wand).  We have a requirement that all of the…

How Do You Calculate Operating Cash Flow?

Today’s guest blogger is Matt McCall of Draper Fisher Jurvetson Portage. Matt writes a popular blog called VC Confidential. Matt takes on the following question: What are some of the best ways you’ve seen to sensibly estimate and/or calculate capital and/or operating cash flow, and how do you like to see this presented to an…

How Do Limited Partners Feel About "Fair Valuation" Guidelines?

Question: How widely accepted are the PEIGG valuation guidelines? I saw some stats from the Dartmouth/Tuck School survey that indicate increasing acceptance, but just how willing are the LP’s to accept write-ups? Our Take: This is a great question and one that, frankly, we wish we had a better answer for. We invite comments to…

What on Earth is 280G? What is a Parachute Payment?

What on earth is 280G? What is a parachute payment? Question: My lawyer mumbled something about 280G and parachute payments. I thought this was only for big public companies and acquisitions? How does this affect VCs? Our Take: Jason spent some time this year co-authoring an article on this with Ed Zimmerman and Brian Silkovitz…