Accelerator Law 101 – part 1

Getting into an accelerator program is a great opportunity to jumpstart a startup by allowing it to gain access to excellent mentorship and exposure. However, apart from the accelerator services themselves, it is crucial to pay close attention to the terms contained within the accelerator investment documents, as there are various issues to be on the lookout for from a legal standpoint. In this post, we will discuss some of the main terms for startups and accelerators to consider when contracting with one another, as well as issues that come up prior to and after the investment itself. Pre-investment issues Structuring the investment One, if not the main issue surrounding accelerator investments is determining how the investment itself should be…

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The Anatomy of a Unicorn – part 2

Previously, we discussed the main ways of handling founder and investor preferences when structuring a company, as seen in some of the world’s leading unicorns. For your convenience, we have put together a table comparing the key similarities and differences in various provisions of the COIs of Uber, Facebook prior to its IPO, Snapchat, AirBnB and Palantir.   Uber Facebook Snapchat AirBnB Palantir Two Classes of Common Stock for Founders Yes Yes Yes Yes Yes Liquidation preference Non-participating preferred Non-participating preferred Non-participating preferred (for Series A, A-1, B, C) Non-participating preferred Non-participating preferred Multiple in liquidation preference 1.25x for Series C-2 and C-3 Preferred 1x 1x 1x 1x Investor relations in liquidation preference Pro rata Pro rata Pro rata Pro…

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DOWN-ROUND FINANCING

Why Down-Round Financing? Down-round financing occurs when stock of a company is sold at a lower price per share than it was sold during a previous financing. Although having to choose to do a down-round may not be an ideal outcome for a company, it is a tool that comes in handy when a company is seeking new investors in times of necessity, economic uncertainty or in a chilled fundraising environment. The legal aspects of a down-round can be challenging tactically and strategically for founders and investors. Structuring a Down-Round Regardless of a company’s reason for opting to sell stock at a lower price than in its previous financing rounds, once such a decision has been made, there are various…

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Darmowe konsultacje prawne dla uczestników Aula Polska

Biuro warszawskie kancelarii prawnej Snażyk Cytowski LLC Sp k. razem z Aula Polska uruchamiają projekt darmowych office hours (konsultacji) dla społeczności związanej z Aula Polska. Snażyk Cytowski LLC Sp k. jest kancelaria specjalizująca się w reprezentowaniu startupów oraz przedsiębiorców... O co chodzi? Biuro warszawskiej kancelarii prawnej Snażyk Cytowski LLC Sp k. razem z Aula Polska  uruchamiają projekt darmowych office hours (konsultacji) dla społeczności  związanej z Aula Polska. Snażyk Cytowski LLC Sp k. jest kancelaria specjalizująca się w reprezentowaniu startupów oraz przedsiębiorców. Jaki jest harmonogram czasowy projektu? Projekt trwa od uruchomienia tj. koniec stycznia 2014 roku do końca czerwca 2014 roku. Do kogo jest skierowany projekt? Projekt jest skierowany do społeczności związanej z Aula Polska oraz do osób, które przekażą wypełniony…

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