Preparing for Funding Overview

Office Hours is our podcast covering general issues related to small businesses and startups. Preparing For Funding is a series of Office Hours episodes about getting your company’s legal house in order before taking on funding.

You can listen on Apple Podcasts or click the links below to see the show notes for each episode.

Preparing for Funding Ep1: Incorporation

  • In this episode, Kevin and Aaron discuss why your company’s legal matters, lifestyle businesses v. venture-backed businesses, whether you should form your entity as a corporation or LLC, implications of the new tax code, and the filing requirements for entity formation.

Preparing for Funding Ep2: Founders Agreements

  • In this episode, we discuss the difference between vesting and reverse vesting, confidentiality agreements and assignment of intellectual property, restricted stock and 83(b) elections, ROFR, and Class F founders stock.

Preparing for Funding Ep3: Friends & Family Funding

  • In this episode, we discuss how to mitigate the risks of Friends & Family funding, which include disproportionate valuations, violating SEC and state securities laws, and messy cap tables.

Preparing for Funding Ep4: Pitch Decks

  • In this episode, we discuss what makes a great pitch deck, the best uses of an appendix, how to get warm introductions to investors, and restrictions on general solicitations.

Preparing for Funding Ep5: Initial Sophisticated Investors

  • In this episode, we discuss qualifications for accredited investors, how to find angel investors, how angel syndicates work, which metrics you need to know for a pitch meeting, and how to respond to getting a “no.”

Preparing for Funding Ep6: Accelerators/Incubators

  • In this episode, we discuss why we’re not big fans of accelerators, the types of accelerators we do think provide value and are worth participating in, and the clauses to watch out for in an accelerator’s program participation agreement.

Preparing for Funding Ep7: Seed Round

  • In this episode, we discuss what constitutes a seed round in Dallas and contrast the three potential structures of a seed round – equity, convertible note, and a SAFE.