Strictly Business

A Business Law Blog for Entrepreneurs, Startups, Venture Capital, and the Private Fund Industry.

  • About the Authors
    • Alexander J. Davie
    • Casey W. Riggs
    • J. Chandler Waits
    • Jennifer Wilson
    • Taylor K. Wilkins
  • Categories
    • Effective Attorney-Client Relationships
    • General Business Law
    • Intellectual Property
    • Mergers & Acquisitions
    • Private Equity and Hedge Funds
    • Startups and Venture Capital
    • Technology
  • Guides
    • Exempt Reporting Adviser Filing Requirements
    • State Investment Adviser Registration

Startup Archives

5 Questions to Answer As You Prepare Your Startup for a Seed or Angel Round

June 14, 2016 by Alexander J. Davie

StartupLast month I wrote about the four stages of startup capital – (1) the seed round, (2) the angel round, (3) the venture round, and (4) the bridge/pre-ipo stage round. This month we’ll take a look at what startups need to do to prepare themselves for a seed or angel round. [Read more…]

Share this:

  • Twitter
  • LinkedIn

Filed Under: Startups and Venture Capital Tagged With: Angel Round, Capital Raising, Seed Round, Startup

Filing Is Not Enough: 6 Steps You Must Take to Incorporate

March 29, 2016 by Alexander J. Davie

This post first appeared in Startup Southerner on February 1, 2016.

When it comes to incorporating a startup, founders often file articles of incorporation (a.k.a. a charter or a certificate of incorporation) with their state’s secretary of state and stop there. They think that the filing is enough to form the corporation. However, forming a corporation involves a number of additional steps, and a corporation is not validly formed unless many of these steps are performed. So, here are the most important ones. [Read more…]

Share this:

  • Twitter
  • LinkedIn

Filed Under: Startups and Venture Capital Tagged With: Incorporation, Startup

Thoughts on the Final Crowdfunding Regulations

January 11, 2016 by Alexander J. Davie

In October, the SEC finally completed its implementing regulations to Title III of the JOBS Act, more commonly known as the “crowdfunding” exemption. The 600-page release can be found here. I’m not going to bother summarizing these regulations, as so many others have done a very good job doing of that already.  So, as I previously did with the proposed regulations, I’ll instead offer some of my thoughts on and reactions to the final rules: [Read more…]

Share this:

  • Twitter
  • LinkedIn

Filed Under: Startups and Venture Capital Tagged With: Capital Raise, Crowdfunding, JOBS Act, SEC, Securities, Startup

Should Founders Subject Themselves to a Vesting Schedule?

May 27, 2015 by Alexander J. Davie

When advising startup clients, I frequently recommend that they subject the shares issued to their founders (as well as those issued to any equity-compensated employees and contractors) to a vesting schedule. This conversation often leads the founders to look at me as if I had just asked them to grow a second head. It’s not hard to see why they would be somewhat confused as to why I recommend this course of action. As a technical matter, usually (but not always) my client is the startup itself and not the founders personally. And while I am always very clear about this with my clients, as I must be as an attorney, my clients’ founders often see me as their adviser, at least on some instinctual level. In addition, at the early stages of a startup, before any significant investors are involved, the founders have complete control over the company.  So they often ask why would they do something like subjecting their own shares to a vesting schedule that appears to be contrary to their own interests and why I would recommend that they take such an action. After all, they can only lose by subjecting their shares to a vesting schedule, right? [Read more…]

Share this:

  • Twitter
  • LinkedIn

Filed Under: Startups and Venture Capital Tagged With: Founders' Stock, Startup, Venture Capital, Vesting Schedule

About the editor

Alexander Davie image
Strictly Business is a business law blog for entrepreneurs, startups, venture capital, and the private fund industry. Its editor is Alexander J. Davie, an attorney at Riggs Davie PLC based in Nashville, Tennessee. His practice focuses on corporate, securities, and business law. He works mainly with technology companies, including startups and emerging companies, and private equity, venture capital, and hedge funds.
Contact Alex

Connect

Riggs Davie PLC logo

Categories

  • Effective Attorney-Client Relationships
  • General Business Law
  • Intellectual Property
  • Mergers & Acquisitions
  • Private Equity and Hedge Funds
  • Startups and Venture Capital
  • Technology

Subscribe

    Sign up today to receive ongoing updates from Strictly Business.

    Copyright © 2011-20 - Alexander J. Davie
    Attorney Advertising | Privacy Policy