On Thursday, April 4th, Perkins Coie’s Palo Alto office hosted the startupPerColator Series event, “Seed Investments: How to Be Attractive to Early Stage Investors and the “Right” Seed Investment Structure for You.”
To meet growing demand from entrepreneurs and investors to empower entities to sustain a triple bottom line, state legislatures across the nation have been creating new corporate forms that give businesses legal protection to address social and environmental problems. Delaware, however, declined to consider whether to adopt such a corporate structure…until now.
I recently participated in a panel discussion on crowdfunding for biosciences, and I wanted to share some of the ideas we discussed. Although focused on life sciences companies, many of the issues are applicable to tech companies too.
The date of an agreement is an important part of most business transactions and M & A is no exception. Many acquisition agreements begin with an “Agreement between” the parties “effective as of” a given date. Does it matter if this effective date is prior to the date the parties actually entered into the agreement? And if so, is this ‘backdating’ problematic or even potentially illegal?
A commonplace among emerging companies is the need to promise investors seats on the board of directors. For a lot of different reasons, it makes sense to make this promise. It is usually a condition to receiving the investor’s capital, so there’s that.
You’ve developed your idea into a business. It’s taken a lot of sweat and hard work, and there have been more than a few rough spots. Acquirers are now taking note and making inquiries. Maybe investment bankers are courting you. You have arrived!! Well, almost . . . .
Potential investors usually request an “Executive Summary” prior to meeting with new startups. The Executive Summary is a one- to two-page document that covers the aspects of the startup that investors care about most, including the concept, the market need and opportunity, and the startup team.
A business plan is a living document that serves as a blueprint to help you build your company. More than that, a business plan is a tool to help you think hard, and clearly, about what you’re trying to achieve, the market opportunity, the potential threats to success, and how to overcome them. How detailed is your business plan, and how much time you invest in it, are matters of choice. And there are some who question the merits of doing a business plan at all.
Many entrepreneurs are wondering when they will get to take advantage of those parts of the JOBS Act that were heralded as new catalysts for start-up equity financing, particularly those sections of the Act engineered to permit crowdfunding and the advertising of certain private equity offerings under the SEC’s Rule 506.
Some interesting stats from The Silicon Valley Bank’s Startup Outlook report based on their survey of private companies across the U.S. in the software, life science, hardware and cleantech sectors. More than 750 companies completed the survey in December 2012.
In response to the question, “What piece of advice would you give to President Obama with regards to supporting the innovation economy,” startup executives had this to say: