Building efficient online businesses
From the category archives:
Question: What are the most tax effective ways for founders to “Pay themselves” for efforts in a startup after the initial startup share allocation round. Is there a more effective method apart from options? Answer: Well, option grants are a tried and true method of post-funding Founder compensation, but not all options are created equal. [...]
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Question: Is it legal and acceptable for a start up to receive donations from fans or well wishers through its website to fund business operations? For example, having a donation section which enables fans to send donations via checks or accepts credit card payment from the website or paypal account. Are there tax implications? Does [...]
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Question: What are the advantages and disadvantages of convertible debt vs. equity? Answer: As we’ve discussed in previous postings, I am very much in favor of the convertible note scenario for non-institutional rounds of financing. To recap, the convertible note structure replaces the sale by early stage companies of equity securities, at a set valuation [...]
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Question: What legal language does a typical disclaimer on a website have to have? (For review websites, product or business reviews.) Answer: The type of disclaimer to be used on a web site is a very fact sensitive issue. You must first establish the nature of the transactions taking place on the website, and then [...]
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Question: What are Important key points for IP Assignment Agreements between employer/service purchasers and employee/independent contractors? Answer: For startup companies, or any company for that matter, that values its intellectual property, making sure that it owns the intellectual property that is created for it by employees and independent contractors is key. Many companies think that [...]
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Question: What is the one term/clause/function you hate seeing in Capital Raising documents for your founders and wish was abolished forever? Answer: I truly despair about “full ratchet” down provisions in the anti-dilution sections of angel/venture capital amended charter documents. Full ratchet provisions grant investors immunity from down rounds by adjusting the conversion to common [...]
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Question: Why would I, as a founder, prefer priced shares (Prefs or Equity) over a Capital Note? Answer: If the context of this question is the Founder’s company doing a capital raise, and the company is a startup (or even a more mature company being evaluated for investment by non-institutional investors), I would prefer to [...]
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Question provided by Faraz Qureshi – an Ultra Light Startups member. Answer provided by Dennis Yu CEO of BlitzLocal – and panelist at SEO for New Websites on Thursday, March 4. Faraz’s Question: Can anyone comment on the value (from SEO standpoint) of submitting blog posts to ‘article aggregation’ sites? For example, I’ve posted blog posts/articles [...]
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Question provided by Jonathan Rosen – an Ultra Light Startups member. Answer provided by Andy LoCascio – President of Sound Strategies, Inc. an Ultra Light Startups affiliate Jonathan‘s Question: How does one create a low cost SEO plan when the range of products they sell is extremely broad and not focused on category of products [...]
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Question provided by Stephen Smyth – an Ultra Light Startups member. Answer provided by Dennis Yu CEO of BlitzLocal – and panelist at SEO for New Websites on Thursday, March 4. Stephen’s Question: Would like panelists to comment on the this blog post that asserts “If someone charges you for SEO, you have been conned” Dennis’s [...]
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