Secrets of Sand Hill Road, Venture Capital and How to Get It by Eric Ries -- Read -- Imperial Library of Trantor

Index

Cover Title Page Copyright Dedication Contents Foreword Introduction

Start by Asking the Right Questions The VC Life Cycle

Chapter 1: Born in the Bubble

What Could Possibly Go Wrong? LoudCloud’s Atypical Success Change Is Afoot in Silicon Valley Y Combinator Cracks Open the “Black Box” Something More An Ode to Entrepreneurs

Chapter 2: So Really, What Is Venture Capital?

Is VC Funding Right for Your Startup? Debt or Equity, Which Would You Choose? Venture Capital as a (Not-Very-Good) Asset Class for Investors The Matter of Positive Signaling VC Investing Is a Zero-Sum Game Investing in VC Is Restricted How Can We Measure Success for a Venture Capital Firm? Forget the Batting Average The Venture Capital Industry Is Tiny but Punches Well Above Its Weight

Chapter 3: How Do Early-Stage VCs Decide Where to Invest?

1. People and Team 2. Product 3. Market Size

Chapter 4: What Are LPs and Why Should You Care?

Types of LPs Where LPs Invest The Mighty Bulldog Time Is of the Essence

Chapter 5: The “Limited” Edition: How LPs Team Up with VCs

What Does “Limited Partner” Mean? The LPA: The Rules of the Road Caring About How the Money Flows Governance: How Is the GP-LP Relationship Managed? GP-to-GP Relationships: The Equity Partners Agreement

Chapter 6: Forming Your Startup

What Form Should Your Company Take? Spoiler: C Corp Carving Up the Ownership Pie Founder Stock Vesting More about Vesting Leaving the Business Transfer Restrictions Acceleration of Vesting Intellectual Property Employee Option Pools The New Normal for Longer IPOs Staying Private and Staying Motivated

Chapter 7: Raising Money from a VC

Is Venture Capital Right for You? What If Your Market Isn’t Huge? How Much Money Should You Raise? . . . And at What Valuation?

Chapter 8: The Art of the Pitch

Foot in the Door What Goes into the Pitch? Pitch Essential #1: Market Sizing Pitch Essential #2: Team Pitch Essential #3: Product Pitch Essential #4: Go-to-Market Pitch Essential #5: Planning for the Next Round of Fund-Raising

Chapter 9: The Alphabet Soup of Term Sheets: Part One (Economics)

Security: Preferred Shares Aggregate Proceeds More about Convertible Debt Price per Share Comparable Company Analysis Discounted Cash Flow Analysis VC Valuation Capitalization Dividends Liquidation Preference Redemption Conversion/Auto-Conversion Antidilution Provisions Voting Rights

Chapter 10: The Alphabet Soup of Term Sheets: Part Two (Governance)

The Board of Directors Protective Provisions Registration Rights Pro Rata Investments Stock Restriction Drag Along D&O Insurance Vesting Employee and Consultant Agreements No-Shop Takeaway: Be Forward Thinking

Chapter 11: The Deal Dilemma: Which Deal Is Better?

Building a Cap Table Evaluating the Governance Terms

Chapter 12: Board Members and the Good Housekeeping Seal of Approval

Private versus Public Boards The Role of the Board

Chapter 13: In Trados We Trust

Duty of Care Duty of Loyalty Duty of Confidentiality Duty of Candor Common versus Preferred Stock The Business Judgment Rule (BJR) Entire Fairness In Re Trados Whither the MIP? Conflicted Board? Applying Entire Fairness Trados Takeaways for the Rest of Us

Chapter 14: Difficult Financings: When Bad Things Happen to Good People

We Are Where We Are, and Something Needs to Change Reducing Liquidation Preferences Learning from the Bloodhound Case Success after a Down Round Winding Down

Chapter 15: Exit Stage Left (The Good Kind)

Getting to Know You Acquisitions and Key Terms Acquisitions: Board Responsibilities Overview of the IPO The IPO Process

Conclusion: The World Is Flat

The Evolution of VC What Might Be the End of Venture Capital as We Know It? Here’s What I Believe about Good VCs The World Is Flat

Appendix Acknowledgments Notes Index About the Author