Tag: startup

The Issue for Founders Founders of startup businesses need to decide whether to incorporate in Delaware or in the state in which they will be conducting business. In spite of the commonly held lawyer view to the contrary, I believe founders should think long and hard before choosing Delaware since

Founders will normally want to use so-called cheap stock when they capitalize their startups. When you form a startup, you contribute cash or other assets to it in exchange for stock. You can also loan money to the entity. The ratio of debt to equity should be modest — normally

According to Pricewaterhouse Coopers, investment by institutional venture capitalists in startups grew from less than $3.0 billion at the beginning of the 1990’s to over $106 billion in 2000. Although venture capital volume has retreated significantly since the economic “bubble” years of the late 1990’s, the present volume of around

Here are ten essential legal tips for startup founders. 1.  Set up your legal structure early and use cheap stock to avoid tax problems. No small venture wants to invest too heavily in legal infrastructure at an early stage. If you are a solo founder working out of the garage,

What is Risk Management? It is basically taking risks for your startup in a controlled environment. So, when you take the risk you have got a backup plan to cover fire in case you run out of ammunition in the war zone (market). This is known as Risk Management in

What's the product? Is there a market? Where is the initial funding coming from? How experienced is the management team? These are some of the first questions investors and lenders want answered when investigating a startup company, and rightly so. The business plan typically addresses these and other related questions

Introduction A startup with a founding team requires a special kind of company formation that differs from that used by a conventional small business in several key ways. This article alerts founders to those differences so that they can avoid mistakes in doing their setup. Attributes of a Typical Startup

The Issue – What It Means to Own "X% of the Company" What does it mean that you own x% of a company? Founders can get confused on this issue. Why? Because there are at least three possible points of reference by which to measure percentage ownership. It can be