Questions tagged [start-up]

A startup company or startup or start-up is an entrepreneurial venture or a new business in the form of a company, a partnership or temporary organization designed to search for a repeatable and scalable business model.

Filter by
Sorted by
Tagged with
0 votes
0 answers
39 views

Pro Rata - Calculate the amount of shares to buy

A company gets incorporated with only 2 stakeholders: 1st stakeholder has 250 shares (a.k.a 33.33%) 2nd stakeholder has 500 shares (a.k.a 66.67%) Price per share: 1$ On it's first financing round: ...
user avatar
  • 101
0 votes
1 answer
80 views

Are software development and consulting services tax-exempted for a newly registered company in Ireland?

TL; DR: I am moving from an "auto-entrepreneur" situation in France to opening a business and I am looking for the best country between the UK and Ireland that could host my business in ...
user avatar
1 vote
0 answers
56 views

British citizen joining US startup as co-founder, tax considerations for stock agreements

I am joining a startup as a co-founder which is incorporated in the US. I am a British citizen (not a US citizen) and will work from the UK, whereas my co-founders will be working from the US. As part ...
user avatar
  • 11
0 votes
1 answer
115 views

If I raised X dollars of venture capital for my startup business, is that X dollar my personal money now? [duplicate]

If I sell a portion of my startup business to a venture capitalist for X dollars for the purpose of raising funds, is that X dollars my own personal money that I can do whatever I want with? Or am i ...
user avatar
0 votes
0 answers
86 views

How to evaluate equity requirement for a stealth startup?

I was asked for salary expectations at a stealth startup. How to go about deciding on the amount of equity when there is no information on their numbers (sales, valuation, etc.) online?
user avatar
  • 353
1 vote
1 answer
50 views

QSBS for restricted stock options

The below applies to a US company I have started at a company where I have received stock that has a 1 year cliff and a 4 year vesting schedule. I earlier exercised my stock and filled out a 83b form. ...
user avatar
0 votes
1 answer
67 views

What type of company/business can be registered with one person?

In some countries, a company must at least has 2 board members to be registered. What about the US? What type of companies can be registered with only 1 person in the US? EDIT: My interest is a S-Corp ...
user avatar
  • 111
3 votes
3 answers
237 views

What financial due diligence should I do when joining a tech startup?

A large portion of compensation from startups is in the form of equity or stock options (often at the cost of lower salary). It's also not good on your resume (at least early on in your career) to be ...
user avatar
1 vote
3 answers
218 views

Why should I offer my tutoring services through a more expensive specialized marketplace instead of a cheaper general classifieds website?

I have posted a related question, but it seems the thread of that question has taken a different direction from what I originally intended. The thread mostly discusses the merits of the startup and ...
user avatar
  • 293
16 votes
4 answers
4k views

Why is this tutor agency startup so highly valued by investors?

I am currently a university student, looking to make a bit of extra money. I got excellent grades in high school, so I was looking into tutoring. I figured from research that I could get some clients ...
user avatar
  • 293
0 votes
1 answer
61 views

Start-up Valuation with employee option pool

I am reading Venture Deals 4th edition and I came across the following statement in a chapter on economic terms of the deal: Consider $5 million investment at $20 million pre-money valuation. Assume ...
user avatar
  • 103
0 votes
1 answer
66 views

Valuing employee bonus stock options in a startup

Oftentimes, a prospective new employee for a start-up is offered stock options as a significant part of their sign-on bonus, if not the entire bonus. When given an offer, say, of an option for 20,000 ...
user avatar
  • 34.7k
2 votes
1 answer
126 views

I want to learn all about money, business models so that I can reshape my future startup into global tech giant? [closed]

I'm currently 17 years old. I have a very brilliant idea of doing some startup in the future and I do believe I can really take it to a global level. But most often than not what I see in the world is ...
user avatar
0 votes
1 answer
61 views

Do low interest rates reduce the growth perspectives after IPOs?

My reasoning is this: A company goes public to raise capital at the price of giving up a certain amount of power and control to the shareholders. Now, if someone founds a company and can borrow risk ...
user avatar
  • 784
1 vote
1 answer
100 views

Can I say operating costs are zero on my business plan?

I worked on a few gaming products during covid lockdown and now I'm presenting my business plan to incubators. I think my operating costs like rent, electricity, etc. are zero since I'm operating from ...
user avatar
  • 113
1 vote
2 answers
38 views

Assessing the value of stock options without the strike price or cap table

I recently received a job offer that offers me a certain number of stock options, but when I asked for the strike price or cap table they said that they cannot share that information with me. Instead ...
user avatar
1 vote
0 answers
98 views

What do I need to do to prepare for starting a business? [closed]

I have this service business that I've been working on the backend (planning, relationships, coding etc) for a couple of years but I don't know how I can get the time/money to launch it. I work 40 ...
user avatar
10 votes
6 answers
2k views

How to structure equity buyout?

Years ago, I helped out a friend on his startup as a software engineer. Spent ~500-600 hours on it, was compensated a little under half my hourly rate + 4.5% equity in the company, because the company ...
user avatar
1 vote
1 answer
119 views

When selling a startup, how is the sale price taxed?

I'm interested in understanding how the sale price of a company passes through an LLC and ultimately finds its way to the founders. Let's say i have a startup which is filed as an LLC, taxed as an s-...
user avatar
  • 165
1 vote
2 answers
418 views

What's the deal with startup CEOs making shedloads of money while his company records yearly losses?

Like say, X company, where the CEO is already a billionaire while his company has lost many billions of dollars in the course of several years? Do you need investment from someone else to do this? If ...
user avatar
  • 11
0 votes
2 answers
113 views

What is the name for a company formed only to make an investment?

What do you call it when someone gets X number of people who all want to invest in Y company; so u create a corp where equity is spread among them, and this corp invests in X company? Sounds like an ...
user avatar
  • 605
0 votes
2 answers
99 views

Stock dilution during funding round?

A fictitious scenario: Suppose a start-up has issued 100 shares. The company is valued at $1,000. The owner has 50% of the shares, and an investor has 40% of the shares, and an employee owns the ...
user avatar
1 vote
2 answers
117 views

Is there a place to see who all invested in a start-up before I invest? [closed]

I want to invest in a start-up but first want to know if it's possible to locate all the current investor? I want to know every detail about this company from how they work internally to how they ...
user avatar
1 vote
2 answers
130 views

Statistically who gets higher **average** income, an employed engineer or IT startup founder? [closed]

Founding a startup is a great idea, you may become as rich as Jeff Bezos, Elon Musk, Bill Gates or Mark Zuckerberg. Wait... or may not. It of course depends on your skills and perspiration they say. ...
user avatar
  • 11
1 vote
0 answers
100 views

How do I document cash capital contribution and digital assets assignment for single member LLC?

I have a single member LLC, which is currently a disregarded entity status (will be upgraded to S-Corp within a month or two). I'm making an initial capital contribution via cash deposit while opening ...
user avatar
  • 11
0 votes
1 answer
55 views

liquidation preference and other loop holes when joining startups who offer equity

There are lots of startups that want to provide equity in exchange for labor rather than a salary or a combination of both. Reading online it seems there are a ton of loopholes where I may not get ...
user avatar
  • 195
0 votes
1 answer
224 views

Why do startups dilute their equity?

I am trying to understand why, when a startup raises funds, it dilutes its equity by issuing more shares, rather than just issuing a portion of the existing shares. For example, let's say a startup ...
user avatar
0 votes
0 answers
57 views

Seeking Equity Split Advice between four co-founders, two of them who have invested money and two who haven't

Founder A,B,C,D are equally responsible for the execution and the idea. At the pre-development stage, Founder A invests $12,500 and Founder B invests $7,500, whereas Founder C and D aren't investing ...
user avatar
0 votes
1 answer
83 views

Startup Expirable Equity

I own a startup that is user-based. We are close to finishing the building of the prototype so therefore it has no users, no revenues, nor any investment. I have 4 unpaid co-op students working full-...
user avatar
  • 103
2 votes
1 answer
313 views

Can Directors issue themselves shares during raise?

I was wondering if it is legal for company directors that also work and operate the business to gift themselves shares during a capital raise in order to retain their controlling interest in the ...
user avatar
  • 21
0 votes
2 answers
75 views

Diluting Shares vs Reserving Shares

I often read about a startup company diluting its shares, in order to provide additional shares for an investor during an investment round. This means that the ownership % for the co-founders is ...
user avatar
1 vote
2 answers
354 views

Why do some startup unicorns lose value as soon as they go public?

It seems that some startup unicorns lose value as soon as they go public (e.g. Uber). Would that mainly be because its shareholders (early VC) eventually want to pull out. And that would be the most ...
user avatar
  • 11
6 votes
8 answers
966 views

Why is it ever a good idea to found a company?

I have a side project with a few friends that's gradually getting more serious. We're nearly at the stage where we'll be taking some early clients, which is really exciting after about a year of ...
user avatar
  • 73
1 vote
2 answers
170 views

Employer won't allow early exercise of options because “RSUs are uncommon and too complex” for venture-backed startups

I asked my employer (a Series A startup) if I could early exercise my stock options for the tax benefits described here. They replied that that would not be possible because the company did not issue ...
user avatar
  • 119
0 votes
3 answers
184 views

How to accurately evaluate the financial potential of a startup with little understanding of business finance?

TL;DR I have been tasked to reevalute the possible financial potential (and by financial potential I mean possible cash-flow, profit, return of investment) of the startup I work in as an R&D ...
user avatar
0 votes
0 answers
76 views

How to contact an investor for a business?

I recently opened a startup and I am preparing a well-crafted presentation of my idea for potential investors. I have to admit that I really don't know how to contact them. Finding them is ...
user avatar
1 vote
1 answer
99 views

Lease equipment to someone or sell it? [closed]

I am currently designing a data logging system for an interested party. The cost of the items assembly and purchase is about $100 (board, power supply, 2 sensors). I want to get lets say 15$/month ...
user avatar
0 votes
1 answer
221 views

Tax implications to sell my pre-IPO shares through Sharespost

Several years ago, I was granted some RSUs from a company and I'd like to sell those RUSs in Sharespost (sharespost.com). I want understand the tax situations here. Let's just say I paid those shares ...
user avatar
2 votes
0 answers
78 views

At formation, in exchange for stock, X contributes cash, Y contributes only "services provided" (sweat equity). What's a smart way to do it?

Setup: X has cash, Y has an idea, experience and contacts and wants to work on this idea full-time. X wants to create a corporation with Y and contribute $100,000 for 50% of its equity. Everything ...
user avatar
  • 121
0 votes
1 answer
183 views

How to find clients for my start-up? [closed]

I will launch a start-up with a couple of friends. We will work as data science and data engineering consultancy. All of us have similar backgrounds in maths, physics, and electrical engineering. How ...
user avatar
2 votes
0 answers
202 views

Tipping point with Cofounder. Is it him or me?

I have been working on a fin tech startup part time for the past year and a half and I am feeling like I am getting screwed over. Currently I have 10% of the equity that will be vested over 4 years ...
user avatar
1 vote
3 answers
501 views

What does "burned through $300 million" mean?

In the book "Antifragility of Islamic Finance: The Risk-Sharing Alternative" by Umar Rafi and Abbas Mirakhor, on page 101 I read the following line: Pets.com, the poster-child company of ...
user avatar
  • 45
0 votes
1 answer
96 views

What type of financial instruments can a company with no assets or money use to raise seed/starting capital

Long story short, I have a LOT of experience as a web administrator, and a lot of experience in retail. I want to raise the money to do acquisitions of small ecommerce operations that output enough ...
user avatar
  • 3
3 votes
1 answer
143 views

Are there any other benefits to exercising EMI stock options straight away vs. as late as possible? (UK)

Once my options vest, according to the EMI scheme I have ten years to exercise them. I'm weighing up the pros and cons of exercising exactly at the point they vest versus leaving it to the last ...
user avatar
0 votes
0 answers
2k views

CAP table for single founder bootstrapped startup

I have bootstrapped my LLC for two years and am now seeking investment. In this case, I'm considering VC. Sequoia pitch deck templates recommends a CAP table. Since I don't have investors currently, ...
user avatar
  • 135
1 vote
1 answer
260 views

Could my app take deposits from and execute stock trades for others but using my own brokerage account?

Don't know if this questions belongs here but I'd figure this place is the closest in relevance. Basically, I want to build an investing application that is open for the public to use. Many ...
user avatar
1 vote
1 answer
145 views

If I plan to get investments later, should I start a C Corp now? Or LLC then convert to C later?

Should I start an LLC then convert later once it is time for investments? Or just start as a C-Corp now? At the moment what I have are open source software tools, and ideas on how to monetize them ...
user avatar
  • 163
6 votes
2 answers
370 views

What are the most common partner equity distribution for startups?

Background I'm doing some due diligence regarding a US registered (Delaware C-corp) tech startup in Europe, where the founders are located and living in the EU. Although the business idea is very ...
user avatar
  • 221
-1 votes
1 answer
177 views

Buy pre ipo'd start up company stock in small amount? [closed]

Is there any investment website/company through which I can buy small amounts of pre-PIOed company stock in a smaller amount? Most require $100K worth of investment. e.g. as an average investor can ...
user avatar
0 votes
1 answer
104 views

Is there a type of investment that doesn't eventually cost the business money for a return?

I have been doing research on types of investing and funding for a startup, but I'm still pretty clueless, so please disregard this question if it's ridiculous. I also apologize if this is the wrong ...
user avatar