Coming up with the right valuation for your company in the beginning can be very tricky. Simply put, valuation is the value of your company. In the early stages of formation the value of your company is most likely close to zero. Obviously, using zero as your valuation isn’t going to help you find investors. Because, while they might appreciate your honesty, they will immediately see your lack of business experience. But what’s the best way to determine valuation? Check out the Funders and Founders infographic to find out How Startup Valuation Works.
When Should I Form a Legal Entity?
As startup lawyers, we often receive inquiries from passionate entrepreneurs and founders seeking guidance on when they should consider taking their side projects to the next step by forming a legal entity. Forming a company is a “crossing the Rubicon” moment for any startup. It’s an essential step…
Investment Company Status Considerations for Cash Positioning in Wake of Bank Failures
Given this week’s headlines, many emerging companies may be asking themselves: “Why am I holding so much cash?” The Investment Company Act of 1940 (the 1940 Act) may be to blame. “But I don’t have any intention of being an investment company. Aren’t those mutual funds or…
Distressed Bank Update as of March 16, 2023
In the three days since federal authorities announced sweeping measures to protect depositors of Silicon Valley Bank (SVB) and Signature Bank and help prevent additional bank failures (as discussed in our update of March 12, 2023), the U.S. banking system appears to have stabilized, at least temporarily.…