As a startup founder raising funds from venture capital investors, you’ll encounter a variety of terms and concepts that can significantly impact your company’s future. One crucial term is “liquidation preference.” In this blog, we’ll discuss what liquidation preference is, the types of liquidation preferences, why investors want them, their prevalence in venture capital deals, implications for startup founders, and …
What are Non-Cumulative Preference Shares?
As a first-time startup investor, it’s essential to grasp the various types of shares that companies can issue during a fundraise. One such share type is non-cumulative preference shares. In this blog, we will discuss the basics of non-cumulative preference shares, their advantages and disadvantages, and how they differ from other types of shares, particularly cumulative preference shares. What are …
What are Cumulative Preference Shares?
As a startup investor, you’re about to embark on an exciting journey with the potential to generate significant returns. One of the key aspects of startup investing is understanding the various types of shares you may encounter during a fundraise. In this blog, we’ll explore cumulative preference shares, though they are not common, at least in earlier stages of financing. …
Understanding Preference Shares: A Founder’s Guide to Raising Capital
As a startup founder, you’re constantly looking for ways to grow your business and secure the funding necessary to make your vision a reality. The moment you have tried to raise you will have immediately come across the issuance of preference shares. This blog post will explore what preference shares are, their advantages and disadvantages, and how they can impact …
Understanding Pro-Rata Rights: A Guide for Startup Founders
As a startup founder, you are bound to encounter various financing terms and concepts while raising capital for your business. One such concept is “pro-rata rights.” In this blog, we will discuss pro-rata rights, their importance, and their implications for startup founders and investors. What are Pro-Rata Rights? Pro-rata rights, also known as participation rights or preemptive rights, are contractual …