Investor Relations

What to Do Now if You Want to Sell Your Company

By Jeremy Glaser

A typical sale transaction can take six to eight months to complete from the time the decision to sell is made. Consequently, it is important that any business owner seeking to sell his or her business in the near term take immediate steps.  The following are some key questions every potential seller should ask to assess their readiness and some key steps they should take to make sure they are ready for a sale.

No Action Letter On Behalf Of Citizen VC

By Daniel DeWolf and Samuel Effron

The SEC has finally provided clarity as to how an issuer of securities can conduct a private placement in a password protected web page under Rule 506(b), without it being deemed a “general solicitation” and thereby being subject to the additional requirements imposed by the new Rule 506(c). The guidance has been provided by the issuance of the Citizen VC No Action Letter (the “CVC Letter”), which request was authored by Mintz Levin.

A Balanced Approach to Founder's Equity

By Daniel DeWolf and Samuel Effron

When accepting money from outside investors, entrepreneurs are generally asked to give up some degree of control over their start-up, exchanging equity in their company for cash. In an effort to minimize the control they relinquish, upon formation of their company entrepreneurs can grant themselves equity that comes with special rights. 

What is a Term Sheet?

By Daniel DeWolf

When a venture capital firm is interested in a company it will meet with the management team numerous times to understand fully the business model and to learn more about the management. At some point in the process, the venture capital firm will decide that the investment is worth pursuing and will present a Term Sheet to the company. The Term Sheet (which is a nonbinding letter of intent) sets forth the basic terms and premises upon which the venture capital firm would be willing to invest.

What Makes a Good Business Plan?

By Daniel DeWolf

The way most businesses are initially funded is by the three Fs. That is, by "friends, family, and fools." After all, who else would provide the initial seed capital to start a new enterprise? But self-funding (or relying on friends and families) will only take you so far in building out your new business.

Your Executive Summary is the Key to Attracting the Attention of Investors

By Jeremy Glaser

You have raised your friends and family/angel round, built out the beta of your product and have a few early paying customers.  Now it is time to raise the money you need to grow from institutional investors.   How do you get their attention when so many companies are in the same boat as you?  Your executive summary – a one to two page teaser – is the crucial document you need to stand out among the noise and get noticed.

Why Does a Company Issue Stock Options?

By Daniel DeWolf

One of the critical keys to a successful venture is aligning the interests of the employees and management with the interests of the shareholders/investors. After all, perhaps the greatest asset of a company is its people. Without a competent and motivated workforce, a venture is unlikely to succeed no matter how great an idea or business concept is involved.

Don’t Make These Ten Mistakes When Selling Your Business

By Jeremy Glaser

Over my three decades of practicing corporate law, I have helped hundreds of founders sell their businesses.  In the process of helping them achieve a successful transaction, I have noted ten common mistakes that can cost the founders money by way of a lower sale price or higher expenses and that can delay or prevent the successful closing of the sale transaction.  If you want to maximize your chances of closing your transaction on time and on the best possible terms, avoid making these common mistakes: