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.
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Does this stock options package sound good?
I got the following stock options offer:
"The stock options will be
granted as possibly feasible following the start of you employment.
The stock options will have a strike price determined by ...
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If my company is going to be acquired for $50m, how can I avoid high taxes? [closed]
Let’s say for example I have a company that is going to be acquired for $50m and I own half it as a cofounder.
How can I avoid a large tax hit?
I know someone who received $25m from an acquisition and ...
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Are banks willing to lend money to one-man APP startups?
I am one person building a social-media-ish APP. I am 2 years along. Let's say that it's 90% finished.
How do you get a bank to lend you money for this APP?
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Do I need a green card if I want to find an investor for my startup? [closed]
Should I either wait until I get my Green Card( maybe 6 months) or can I reach to investors with my EAD card if I have a complete mobile application ready to launch + a business plan for that?
PS: I ...
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Do investors have any copyrights on the application they invest on? [closed]
Considering I am the founder of Instagram, it means I have written 100% of the application code by myself, then found an investor and they put some money into the startup and got 30% of the new ...
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Are employee stock options worthless in a highly valuable company that never "exits"?
What happens to employee stock options and stocks in those rare cases where a start-up is wildly profitable -- but the founders never "exit"? That is, it never goes public or is acquired.
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How to convince the investors without actually revealing the idea in the first place? [closed]
Let's say I've developed an application and it's all done; nevertheless, it still needs supporting resources and a good marketing and all the other matters that are required for a success; but, I don'...
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As an investor of a business, how do you prevent the founder from holding back growth? [closed]
If you are an investor who owns 30% of a business and the founder owns 70%, how do you prevent a situation where the founder decides to always take profits and not reinvest them to grow the business? ...
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What is the best getting investment strategy? [closed]
Consider a person wants to create a giant company as big as Airbnb, Netflix, Coinbase, etc. And he has an idea that investors will love it.
This person also knows the computer programming and can ...
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How much are my shares worth in the startup I work for?
So I joined a startup last year. They gave me 50,000 options (ISO) with the exercise price of $0.4 per share. Currently I do not how many shares the company has in total, but in the print of the ...
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Pro Rata - Calculate the amount of shares to buy
A company gets incorporated with only 2 stakeholders:
1st stakeholder has 250 shares (a.k.a 33.33%)
2nd stakeholder has 500 shares (a.k.a 66.67%)
Price per share: 1$
On it's first financing round:
...
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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 ...
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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 ...
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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 ...
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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?
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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. ...
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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 ...
user82352
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
user106895
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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 ...
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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-...
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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 ...
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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 ...
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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 ...
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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 ...
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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. ...
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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 ...
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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 ...
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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 ...
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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 ...
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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-...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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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 ...
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