Emerging Enterprise Center Blog - Commentary and Analysis For Entrepreneurs and Startups

One thing that happens in the law business (I imagine any business) is that you become too familiar with the subject matter. As a result, you may start to take it for granted that your clients see the world the same way you do. This thought was sparked because I had a start up client ask a bunch of great questions about angel notes into a future financing. At Foley we deal with these kinds of angel notes all the time. For any given client, however, each note is likely to be a unique experience. Anyway, it is nice to... More

In the context of angel investment, one question that I get on a regular basis is whether investments should be structured as preferred stock or convertible notes. As with every question that you ask a lawyer, the answer is "it depends." Here are some thoughts on the merits and demerits of each:... More

I had occasion to participate in a panel presentation on the general topic of angel financing terms and conditions. Many of the participants were concerned about how to negotiate terms and the consequences of certain kinds of provisions. The panelists, myself included, tended to cater to this by talking about trying to avoid certain terms, etc. In the world of angel financing, the range of size of investment and length and complexity of documentation varies dramatically from the family friend who writes a check for some common stock to the sophisticated angel group that behaves much like a VC.  Upon reflection, however, all... More