Download - Startup Equity Splitting The Equity Pie
Startup Equity: What Founders Need to Know about Splitting the Equity Pie
Peter StoneCounselHopkins & Carley
Glenn McCraeChief Strategy OfficerEGFS
#StartupEquityPie
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About Us
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Introduction• You're getting ready to raise capital … what do you need
to know? Who are the players? • Startups are equity plays • Key stakeholders and considerations• What’s included in “startup equity” and what’s not
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Getting Ready for the “First Real Round”
Have a capital strategy as part of your business plan• How much do you
need?• Where are you going
to get it? • What milestones are
you going to achieve?
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Sidebar – Anatomy of a Capital Structure
Authorized shares
Issued and outstanding
Fully diluted
Common stock
Preferred stock
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Founder Stock
• Starting with 100%• Co-Founders• Initial capital
contributions• To vest or not to vest?
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Seed Stage Investors • Profile of seed stage investors
• Friends and family • More sophisticated angels
• Negotiating the deal• Legal agreements• Convertible notes• Cap• Transition to next stage – impact on Series A
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Board of Advisors
• The role of a Board of Advisors• Stock compensation for Advisors• Sidebar – Advisors v. Directors
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Service Providers
Distinguish role from other early players
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Early Employees
• Startup employees are different • How employees look at equity:
the naïve and the savvy• The employee pool• Attracting talent: putting a
package together: options + cash
• Legal structures and issues for employee equity
• Contractors?
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Transitioning from Seed to Series A
• Every decision on equity affects Series A (and beyond)• Living with your early shareholders• Introducing your new shareholders
Seed Series A
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Thanks and Q&A
Hopkins & Carley, A Law Corporation200 Page Mill Road, Suite 200
Palo Alto, CA 94306T: (650) 804-7600
@HOPKINSCARLEY
Peter F. Stone, Esq., Of [email protected]
Glenn [email protected]
2033 Gateway Place, 5th Fl.San Jose, CA 95110T: (415) 320-5753
@EARLYGROWTHFS
