Venture deals
by Brad Feld · first published 2011
84% recommend15% neutral1% critical
Why HN recommends it
Easy-to-digest guide to venture deal terms such as common vs preferred stock, liquidation preferences and option rights. Founders should read it before taking investor money; employees weighing equity find it useful too.
Summarised by Claude from recommending comments
"An engaging guide to excelling in today's venture capital arenaBeginning in 2005, Brad Feld and Jason Mendelson, managing directors at Foundry Group, wrote a long series of blog posts describing all the parts of a typical venture capital Term Sheet: a document which outlines key financial and other terms of a proposed investment. Since this time, they've seen the series used as the basis for a number of college courses, and have been thanked by thousands of people who have used the information to gain a better understanding of the venture capital field.Drawn from the past work Feld and Mendel
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Rookie mistake. Read Venture Deals: http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalis...
on “What I Learned Negotiating With Steve Jobs” ↗…lot of capital but didn't live up to their expectations. Those companies will often be under pressure to accept terms in later stage financing that could destroy founder and stock option pool upside. 5. Venture Deals by Brad Feld is a great read to understand different investment terms. 6. Yes you get more equity if you create your own company. Doing so is extremely risky, stressful and hard though. I'd guess that…
on “Options vs. Cash” ↗…helpful should be wider. I'd recommend some that might be a little easier to get through (just of the top of my head): -Losing my virginity (Branson) -How to win friends and influence people (Carnegie) -Venture deals (Feld) -Man's Search for meaning (Frankl)
on “Books Every Entrepreneur Should Read” ↗I wrote a book that covers general/universal business principles: http://book.personalmba.com For common funding and legal issues, I recommend "Venture Deals" by Brad Feld and Jason Mendelson: http://www.amazon.com/dp/0470929820 For finance and accounting, I recommend "Financial Intelligence for Entrepreneurs" by Karen Berman, Joe Knight, and John Case:…
on “Suggest HN: Write a book on business for Hackers” ↗Many experts, including Brad Feld in his awesome book Venture Deals, have said that asking VCs or others to sign an NDA for a basic pitch is an obvious sign of an amateur and totally not necessary. That makes a lot of sense to me. But very recently I came up with a…
on “What info (if any) should be kept secret about new startup ideas?” ↗These books on the subject of term sheets are solid https://www.amazon.com/Term-Sheets-Valuations-Intricacies-Bi... https://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitali...
on “What I Wish I'd Known About Equity Before Joining a Unicorn” ↗…make it happen. Passionate origin story: we build a b2b tech. Most VCs seemed happy with 1 - we understood this problem from working on/near it 2 - we're building a solution Oh, and read the book _venture deals_ by brad feld and jason mendelson [1]. Seriously. It's extraordinarily valuable. Seriously consider doing the YC pre-YC program. It's all funnel for YC, but the info is good. Though it can be summed…
on “Why fundraising is a terrible experience for founders: Lessons learned” ↗First, Read "venture deals" by Brad Feld Then understand that what both of you should have done is 4 years vesting with 12-month cliff. With that come to an agreement that since you did two years, you should keep only half of…
on “Ask HN: Co-founder leaving a startup for free without equity?” ↗To learn about the CTO stock options, vesting, and employee pool of options, this is the best book I've read on the subject: Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist by Brad Feld and Jason Mendelson.
on “What should I ask for when negotiating a CTO position in a funded start up?” ↗Although not a book about becoming a VC or angel investor, Venture Deals by Brad Feld and Jason Mendelson of TechStars and Foundry Group does cover a lot about investments and common things you should understand (which is something useful to know if you're looking to get into…
on “Ask HN: books / articles about becoming a vc?” ↗Venture Deals, by Brad Feld and Jason Mendelson. The full title is "Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist." It's aimed at founders who have little understanding of the processes, players,…
on “Ask HN: a good book on start-up fundraising?” ↗Pitching Hacks: How to pitch investors by Naval and Nivi of AngelList - http://venturehacks.com/pitching Venture Deals: Be Smarter than Your Lawyer and Your Venture Capitalist by Brad Feld and Jason Mendelson - http://www.amazon.com/gp/product/0470929820/ref=as_li_tf_tl?...
on “Ask HN: a good book on start-up fundraising?” ↗It sounds like you're interested in the legal and bureaucratic mechanics of it all. While you can also find all the content scattered around his blog archives, Brad Feld's 'Venture Deals' puts it all in organized book form. Keep in mind that Feld's book focuses heavily on the venture-backed side of startupland and you're missing the other part of the picture. For that, buy a basic guide…
on “Do you know any comprehensive guides on the business side of a startup?” ↗…high-level economic terms of the deal? You should ask around to see what is fair market terms for the options you should receive. You should do a search on angel.co/jobs and look at comparables. Read Venture Deals by Brad Feld and Jason Mendelson even if you are not a founder. Founders and investors know this stuff. If you are naive going into your employment you may end up being screwed out of upside. Get your…
on “What you need to know about employee stock options” ↗…new reading material, some good ones I've read this year (in no particular order); Who owns the future - Jaron Lanier Canoeing the Congo - Phil Harwood Margaret Thatcher - The Authorized Biography Venture Deals - Brad Feld / Jason Mendelson 1000 Ultimate Experiences - Lonely Planet
on “The Best Books I Read in 2013” ↗