12.6 C
London
Saturday, October 1, 2022

From spinouts to fundraising to M&A, founders need transparent deal terms – londonbusinessblog.com

Must read

This is how much your EMI will rise after the recent rise in the repo rate

Over the past two years, interest rates on loans have risen by 1.9% – causing the EMI math of most borrowers. Most experts...

Hurricane Ian death toll rises

At least 23 people in Florida have been killed by Hurricane Ian, state officials said Friday.The actual death toll from the powerful Category 4...

Tesla’s robot strategy is inextricably linked to its Autopilot strategy, for better or for worse • londonbusinessblog.com

Tesla unveiled its first prototype of its Optimus humanoid robot on Friday — a real robot this time, by the strictest definition, rather than...

Enjoy these exclusive benefits in the TC+ Lounge at Disrupt • londonbusinessblog.com

Everyone knows that membership has its privileges. And that adage holds true at londonbusinessblog.com Disrupt, which takes place October 18-20 in San Francisco....
Shreya Christinahttps://londonbusinessblog.com
Shreya has been with londonbusinessblog.com for 3 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider londonbusinessblog.com team, Shreya seeks to understand an audience before creating memorable, persuasive copy.

Welcome at the londonbusinessblog.com Exchange, a weekly newsletter about startups and markets. It is inspired by the daily londonbusinessblog.com+ column from which it takes its name. Every Saturday in your inbox? Register here.

With downturns looming, startup founders have much less leverage over deal making than they did in 2021. Being new to the fundraising game, the changing market will require an accelerated lesson on less favorable term terms such as liquidation preferences. The information may have been forgotten during the last cycle, but at least it is available, which is less the case for university spinouts and M&A. Let’s dive in. Anna

Investor protection is back

When it comes to fundraising for startups, there is much more open discussion about deal terms today than there was 10 years ago. But with founders only getting a few coins in their lives, compared to the multiple deals VCs and lawyers see, it’s as important as ever for entrepreneurs to understand what they’re signing up for.

“Deal terms look different in a recession”, my colleague Rebecca Szkutak wrote. The lawyers she spoke to predicted that certain clauses designed to protect investors will yield returns — which also reflects what we’re hearing through the vine† Among the amenities to look out for are liquidation preferences, pay-to-play and dilution protection, including the dreaded full ratchet.


More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest article

This is how much your EMI will rise after the recent rise in the repo rate

Over the past two years, interest rates on loans have risen by 1.9% – causing the EMI math of most borrowers. Most experts...

Hurricane Ian death toll rises

At least 23 people in Florida have been killed by Hurricane Ian, state officials said Friday.The actual death toll from the powerful Category 4...

Tesla’s robot strategy is inextricably linked to its Autopilot strategy, for better or for worse • londonbusinessblog.com

Tesla unveiled its first prototype of its Optimus humanoid robot on Friday — a real robot this time, by the strictest definition, rather than...

Enjoy these exclusive benefits in the TC+ Lounge at Disrupt • londonbusinessblog.com

Everyone knows that membership has its privileges. And that adage holds true at londonbusinessblog.com Disrupt, which takes place October 18-20 in San Francisco....

Elon Musk unveils Optimus TeslaBot prototype during AI Day 2022

Tesla CEO Elon Musk revealed a prototype humanoid "Optimus" robot that shares some AI software and sensors with its cars' Autopilot driver assistance features....