If you’ve raised a pre-seed or seed round in the past few years, you likely did it through a SAFE (Simple Agreement for Future Equity). And if the early investor pushed back on your valuation cap, or you didn’t want to set one yet, you may also have agreed to a “Most Favored Nation” clause
Most ECVC lawyers can recite from memory the basic architecture of venture anti-dilution protection. The standard NVCA formulation adjusts downward the conversion price of preferred stock when the company issues additional equity at a lower price, subject to a familiar list of “Exempt Securities.”
In straightforward scenarios where it’s clear what the price of that
Starting January 1, 2024, virtually all private companies will be required to report information about their beneficial owners to the Treasury Department’s Financial Crimes Enforcement Network “FinCEN”) under the Corporate Transparency Act (the “CTA”). But the CTA presents unique analytical and reporting challenges for startups and venture backed companies because of the special economic and governance rights negotiated with investors in early stage and venture funding rounds.
Continue Reading Corporate Transparency Act Risks for Startups and Venture-Backed CompaniesThe Wall Street Journal ominously reported on February 28 that the Securities and Exchange Commission recently issued dozens of subpoenas to initial coin offering issuers and their advisors demanding information about the structure of their ICOs. Although the Commission has yet to 
officially acknowledge them, the subpoenas are consistent with a series of SEC enforcement
In Part I of this two part series on model structures for seed rounds, I explained how the dramatic decline in the cost of launching an internet-based startup over the last 15 years primarily due to the disruptive effects of open source software and cloud computing has led to a surge in seed stage investing