4 Reasons Why Borrowing Money Is Usually Better Than Giving Up Equity

Image credit:Dan4th Nicholas | Flickr There’s a pervasive myth that no debt is good debt. Whenever we’re talking about owing money these days, it’s almost always in a negative light. You hear it every day: homeowners are underwater, the national deficit is surging, consumers are saddled by shortsighted credit card spending, the nation’s graduates are …

The Art and Science of Company Valuations (Infographic)

Image credit:Shutterstock Instagram, Spotify, Square, Pinterest, and the list goes on: It's starting to seem like billion-dollar startup valuations are a dime a dozen. But how does a young company get a billion-dollar price tag? The below infographic by San Francisco-based startup organization Funders and Founders details how a startup is typically valued. A valuation …

Vesting: A Founder’s Need to Earn Equity

Image credit: zzzack Vesting is absolutely standard in venture deals. It is predicated on the notion that the founding and management teams must earn their equity ownership by contributing to value creation through so-called "sweat equity," or hard work. Vesting requirements address free-riding issues by mandating a commitment to the enterprise — a requirement around …

What Is Angel Investing?

Angel investors are usually wealthy individuals who invest in start-ups, usually at a very early stage, in return for equity. They often are experienced entrepreneurs and businessmen who provide their expertise as well as their capital to young businesses. Angels usually have to be accredited investors as defined by the Securities Exchange Commission (SEC). An angel must have …

Tips To Attract Venture Capital

When it comes to venture capital, there is no formula to guarantee success. It’s important to understand that every company and every venture capital firm is different. Moreover, most companies face issues and challenges that can only be overcome through perseverance, resolve and creativity, no matter how large their funding. However, there are a few …

What is Venture Capital?

Venture Capital (VC) is money that investors give to startup companies that are perceived to have high growth potential in the long term. This is a very significant source of financing particularly for startups who have little or no money to fund the necessary operations to take them off the ground. While the risk for …