3 Keys To Venture Capital

8 May

Thanks to Brad Feld for this-

“VCs only need three rights: Up, Down, and Know What The Fuck Is Going On”

Up: Pro-rata rights. When things are going well (up) a VC wants the ability to continue to invest money to maintain their ownership.

Down: Liquidation preference. When things don’t go well (down), a VC wants to get their money out first.

Know What The Fuck Is Going On: Board seat. Beyond demonstrating that older VCs also swear in public, many people believe that with a board seat comes great power and responsibility. In reality it mainly gives one the ability to know what’s actually going on, to the extent that anyone knows what’s actually going on in a fast moving startup.

I will now add pro-rata rights, liquidation preferences and board seats to the 15 day MBA Program.

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