Category: Securities Laws

Startup Financing Is Not A DIY Project

There are projects that are easy enough for a smart startup founder to take on, and then there are projects that are simply too complex, and which require the help of an experienced lawyer. Financings, such as a seed round or convertible note financing, are definitely not DIY projects. Several years ago, I bought a […]

New Exemption for Sales of Restricted Stock

President Obama signed legislation this month that creates a new, explicit exemption for private resales of restricted and control securities. The legislation, contained in Fixing America’s Surface Transportation Act (the FAST Act), will make it easier for the holders of restricted stock to cash out their holdings, provided they sell only to accredited investors. Here […]

EQUITY CROWDFUNDING 2.0

On October 30, the SEC took another shot at legalizing equity crowdfunding, by passing final regulations that are much more streamlined and simpler than the original regulations. The new regulations will take effect sometime next spring or summer, at the earliest. Under the new regulations, a company can raise a maximum aggregate of $1 million […]

The Friends & Family Round

Prior to doing a seed round or a full venture capital financing, startups frequently need to do a “friends and family” round of financing. This money is often essential to carry startups through to the point where an angel investor would be interested, especially in the regions where angels will require more than just an […]

SAFE – A New Financing Tool for Startups

If you follow startups, you’ve probably heard of convertible notes and Series A financings, but the newest item is the SAFE – the Simple Agreement for Future Equity. SAFE is a seed-stage financing tool that provides a lower-cost, speedier alternative to convertible debt financings. SAFE was devised by Y-Combinator partner Carolynn Levy, who is also […]