Trigger accelerations are often a hotly debated topic (especially in companies acquired by VCs) as any outstanding equity will impact the value of shares of the purchase price.
409A valuations are independent appraisals of a startup's common stock. Startups should use an independent, outside valuation firm to get a 409A valuation before offering stock options to employees to avoid fines and legal issues with the IRS.
Most founders have little clue about how cap tables work when they start their first startup. Keeping accurate records of your cap table is essential for startup founders if they plan on raising capital from VCs or selling the company.
Startups that allow the early exercise of stock options help minimize their employees’ tax liabilities and increase the return on common stockholder equity.
We cover some of the important steps founders will need to take after incorporating their startup, like 83(b) elections, getting an EIN, opening a bank account & more.
Just getting your startup incorporated? Find out how to price your company's common shares and learn how the fair market value (FMV) of common shares changes as your company grows.
Issuing equity to employees in an LLC can be complex and require tax advice. Many startups prefer to incorporate as C Corporations because the process for issuing equity to employees is much simpler.
Should you grant your startup employees their stock options as ISO or NSO? Why do most early stage companies grant their employees equity options in the form of ISO instead of NSO? The answer: ISO have special tax advantages.
Registering in the US opens the door to venture funding for overseas startups. Learn about the process for registering your company in the US as a foreign citizen, including incorporation, taxes, visas and more.
Co-founder exits can be a messy ordeal for startups, but they don't have to be fatal. Learn how to avoid messy co-founder exits and protect your startup.
Startups typically issue common shares to founders, employees, advisors and consultants; they issue preferred shares to investors as part of venture financing rounds The preferred class of stock in a startup is typically subdivided into series, each representing a different round of financing, like Series A, Series B, and so on.
A detailed overview of the different types of equity compensations for employees at startups, including restricted shares awards, stock options and RSUs. Each type of equity award has different tax implications for employee shareholders at startups.
Startup investors strongly prefer to invest in C Corporations over LLCs for tax and diligence reasons. The proceeds from selling stock in startups registered as C Corporations can be tax exempt due to Qualified Small Business Stock exemption.
Avoid these common legal mistakes made by startups and save your company from dealing with fines and lawsuits. As a startup founder, keeping your company compliant is essential to protecting the value of your startup equity and reaping the rewards of your hard work.