Decoding Equity And Convertible Notes - Startups 101

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Understanding stock, preferred stock, options, convertible notes, angel investing, venture capital, and other fundraising instruments can be truly overwhelming.
If you are an early-stage startup company in the tech space, the best way to raise capital is with a convertible note or a similar instrument. However, to understand how those work, we first need to understand how stock works.
#startups #fundraising #venturecapital #slidebean #startuplife
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About Slidebean
Slidebean is a platform for founders to scale their startups. Our platform offers everything you need to build your startup, your pitch deck, set up your company, and start gaining traction.
Our team of experts can also help you write and design your pitch deck and build the financial model for your startup.
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Caya
Twitter: / cayahere
LinkedIn: / caya

Опубликовано:

29 сен 2024

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Комментарии : 759

@slidebean 4 года назад

Last year, companies using our pitch decks raised $300M+ in venture capital. Here's how we can help you ►slidebean.com/?

@lekantaiwo 4 года назад

am trying to find a book you posted that has directories to american investors

@lamaalzahrani984 4 года назад

lekan taiwo is there any book like so? Please help

@abdulsiyanbade2828 Год назад

unless I misunderstood this, I think there's a mistake at 12:00. I believe Gus should be 75,000 shares while Madigral would then be 21,500 shares. Great content though! Learned a lot here.

@ahmedcine 11 месяцев назад

AbdulSiyanbade, I thought so, too. Excellent content, all the same.

@optionstrader1939 4 года назад

I’m a VC/IPO/M&A lawyer and was looking for some easy videos to explain startups, VC funding, etc. to my 18 year old daughter who is beginning business program at college. This video and this entire series is excellent. I also used to teach this stuff at MBA/Law school and explaining these things in a concise and easily understandable way is not all that easy. Great job to the Slidebean guys. And yes, as you mentioned in another video, what you have done with your company and technology is amazing even if you did not displace PowerPoint, etc. Congrats on your success and on eventually figuring who you really are and what your market is. Sadly, most tech entrepreneurs never make it that far.

@slidebean 3 года назад

Thanks! :)

@techie2103 3 года назад

@@slidebean hi can you explain about class a shares vs class b shares ?

@tetroblanco3509 3 года назад

How can I reach you if I have a possible Unicorn Startup

@captainkip4624 3 года назад

Man isn't that the truth. It took us 3 maybe 4 years to figure out who our customer was. This an excellent knowledge transfer throughout the series and highly recommend them. I also started playing with the app. There is a lot of potential here.

@optionstrader1939 3 года назад

@@tetroblanco3509 Hi. Sorry for delay in replying. I dont use RU-vid all that much so I just saw this. Unfortunately I’m way too busy to help any more companies, but I appreciate you thinking of me.

@dylandxothomas4132 4 года назад

I've been trying to understand this for a looong time and finally, you laid it out in a way that very easy to understand Thank you brotha. I will definitely subscribe and share this content.

@slidebean 4 года назад

You're very welcome! Thanks for the sub!

@princedavid8420 4 года назад

This lecture is quite apt. I got my education on RU-vid; and I've no regrets.

@EdlyDestinedds 2 года назад

This was one of the most informative videos I have ever watched on youtube! Thank you

@vitikahappy 4 года назад

Every time I watch this guy leaning forward I have a feeling that his head will pop-up from my screen any moment :-) But great explanation indeed. Thank you.

@bimskool 4 года назад

YC does have a video on this but it's not as good in explaining dilution and the math behind everything. There is such a thing as a convertible note without interest called a SAFE which may or may not have a valuation cap.

@jorgerangel2390 3 года назад

Congrats, this is the best video explaining equity in detail.

@reneewilliams4656 5 лет назад

Thank you! This was very helpful. You spoke about SAFE briefly at the end, but could you make a similar detailed video for capped, uncapped, and discounted conditions please?!?

@cayahere 5 лет назад

Thanks for watching, Renee, Will look into this.

@BelindaAng 5 лет назад

@@cayahere I would love to see this video made too!

@cayahere 5 лет назад

Got it, will work on this.

@prateeksingh1569 4 года назад

How should the equity negotiations go about if the company has just been incorporated, not started operations and not making any revenue? In other words, a non-operating company 'X' having 2 co-founders gets an investor that gonna put in the whole amount to start the operations, how should the directors of the company 'X' negotiate the equity divisions with the investor in a manner that is most beneficial for them in the long term?

@slidebean 4 года назад

Hi! That question seems perfect for our Startup Café slidebean.com/startup-cafe Drop it there so you can start the conversation with Caya and other founders!

@andrewriad5934 4 года назад

Could you make a video on SAFE notes? I’ve seen that you mentioned it in your convertible debt video but if you could make a video that dives into the details of SAFE notes that would be very helpful. Love your videos btw. Keep them up. Thank you!

@slidebean 4 года назад

Idea noted, thanks!

@BrettFoxstartupceo 3 года назад

Nice run through of basic information about equity.

@crow578 Год назад

Your videos are very informative. I'm a disabled, chronically homeless veteran with a very profitable, "disruptive" technology. I'm literally destitute - how can I raise seed capital?

@Tyrell_ai 3 года назад

Man, your video makes it so easy to understand. Really thank you!!!

@johnchinyuku3063 4 года назад

This is very good very informative and straight to the point thank you. I have subscribed

@slidebean 4 года назад

Thanks for the sub!

@iancameron456 2 года назад

Thank you so much for your content, I've learned so much

@CalebEliason 5 лет назад

Caya - The cap table at $50m has Gus & Madrigal's shares/equity flip flopped. Gus has 75k shares & 6.8%, Madrigal has 21.5k & 2%. Tried to email but it bounced. Happy to pull this comment once I know you're aware.

@cayahere 5 лет назад

Actually, I believe it is correct. Gus gets 75K shares because his investment, while smaller, converted at the cap. Madrigal converted at the $50MM valuation, so they get less stock.

@CalebEliason 5 лет назад

Exactly my point. The cap table shown from 11:57 to 12:02 has them switched, Gus with 21.5k and Madrigal with 75k. It should be the other way around, as you described in your reply.

@cayahere 5 лет назад

@@CalebEliason You are absolutely correct. Already figuring out how to revise/fix this.

@CalebEliason 5 лет назад

The video is extremely well done & contains information founders must be privy to. When I ran BoomStartup, (#12 tech accelerator per techcrunch '13-'14), we hammered similar material. I really didn't want to point it out, the video is otherwise perfect. Nice job & thanks!

@z1sania 5 лет назад

they messed up with colors and numbers too. Correct numbers are: 1.96% for M, 6.84% for Gus, and 45,6% for each founder

@kaname110 4 года назад

Super cool and informative video! Thanks a lot!

@rudhisundar 4 года назад

I have to thank Caya! Thanks a lot!

@slidebean 4 года назад

Thank you too! Glad the video helped!

@MEMEGOD30 4 года назад

Great video. Can someone explain the share distribution table at 10:57? If Madrigal invests $1M at a $5MM valuation (20% equity), why is his total 16.7% instead of 20%? (I see how the math is calculated - 1,131,250 shares x 1.20% = 1,357,500 shares, giving Madrigal 226,250 shares at 16.7% of the cap table, but don't understand the reason behind his dilution from 20% down to 16.7%)

@MEMEGOD30 4 года назад

I am assuming the reason is because you are issuing new/additional shares to Madrigal instead of merely transferring shares from Walter/Jesse/Gus.

@sadiqodubayo6940 3 года назад

Hi can you share the excel template that explains the video. Thanks

@alexavolin 2 года назад

Nice video. But you made a mistake again with the number of Gus' and Madrigal's shares. You inverted them. Excellent content, but you should just give it another review before uploading. Thanks again

@pfromeurope 4 года назад

that shooting angle though

@prachikhaladkar5818 5 лет назад

best video with simple language... thnkuuu!!!

@tawilk 2 года назад

anyone have links to the convertible bonds that free to fill out and save on lawyer fees?

@pantakhemraj 5 лет назад

Love you and your simple presentation.❤

@slidebean 5 лет назад

Thank you Khemraj!

@dididadadoo 2 года назад

Is it me or the number of shares between Gus and Madrigal at 11:59 should be reversed...

@phantom5101 3 года назад

Just go to kickstarter

@adamkennylau7950 5 лет назад

I think Gus's and Madrigal's shares are swapped in the slide. Gus should end up with 75k shares, and Madrigal 21,500 shares. Perhaps I am wrong, but do check.

@slidebean 5 лет назад

They are. Pinned a comment about it. Sorry for the mess up- it was a complex video.

@anvarxadja 4 года назад

Hi, i do like how you explain everything. I live in San Francisco and I’d love to connect with you and get some valuable advise, if you don’t mind:)

@slidebean 4 года назад

Hi, Anvar! Caya connects for live QandA's every week on Discord, feel free to join him there: slidebean.com/live

@anvarxadja 4 года назад

Thank you!

@karuneshnigam7311 4 года назад

I subscribed it

@slidebean 4 года назад

Thank you! Welcome aboard!

@rai4241 4 года назад

Hands down on the explanation

@JonRawlinson 5 лет назад

i just learned a ton! thank you!

@BelindaAng 5 лет назад

The most effective explanation I've come across! Have subscribed! Looking forward to your view on vesting.

@slidebean 5 лет назад

Thanks for subscribing, knowing that our content is being valuable to you guys makes our day!

@cayahere 5 лет назад

Glad this helped. It was pretty insane that a clear explanation about these concepts was nowhere to be found.

@awesomethings9712 5 лет назад

It was really very simple easy to understand. Anyways belinda ang are you in china

@awesomethings9712 5 лет назад

Belinda Ang I am foreigner in china too

@BelindaAng 5 лет назад

@@awesomethings9712 No, I'm from Singapore.

@chrisbaumann6850 4 года назад

Great content Asma'a - apreciated! Just to correct 11:59: Walter/Jesse: 500.000;45.6% //Gus 75.000;6.84%//Madrigal 21.500;1.96%

@Cornerstone4684 Месяц назад

Exactly! Great video and clear explanation but I repeated the maths and he need to correct so Gus: 6.8% & Madrigal: 2%

@fumbio2718 5 лет назад

This feels like a MBA class in 15 mins brilliant

@cayahere 5 лет назад

Fumbi O funny thing is… I didn’t even study business.

@ogorchukwuofili7319 4 года назад

Tbh!

@blanche1935 4 года назад

Caya I am studying business, but honestly you don’t have to. Specially, when you have previous experiences of founding companies such as your case. In fact, your experiences in this channel are invaluable and it’s something that I have not acquired from any classes. So thanks a lot for the content! :)

@ibukontraktor-taqwaproperty 3 года назад

No it doesn't.

@drgLACity 3 года назад

Anyone want to invest on my start up?

@kishalayray7570 5 лет назад

You are the only one who is delivering these valuable contents on RU-vid love and thanks from India

@cayahere 5 лет назад

General Science 🙌🙌

@tainadinapoli7993 5 лет назад

I so agree

@3519Marc 5 лет назад

Thank you , really enjoyed the presentation and was well worth watching. Note on the supercharged round you flipped the values for Gus and Mardrigols position. Gus with the 7 million cap should have a larger amount than Margo with her 1 million investment and 50 million valuation. please check it out thanks again for the video .

@inecosolarsolutions9022 5 лет назад

This looks very good, thanks for sharing the knowledge. Could please explain the number of shares for Gus and Madrigal at 10:57?

@slidebean 3 года назад

Issuing a correction/clarification. There's an error on 10:58, the colors and percentages for Gus and Madrigal are inverted.

@IdowuObadeyi 3 года назад

Now I'm a lil confused. My understanding is that Gus converted at (525k/4million valuation * 1,000,000shares). So, if that's the case the chart is correct as is. What do you mean "inverted"?

@fredericpette6483 3 года назад

I would suggest that the error is not on 10:58 (the whole slide is fine there) but rather on 11:59: there, indeed, Gus should be credited with 75'000 shares and Madrigal with 21'500.

@rahulhotchandani5639 3 года назад

@@fredericpette6483 this is correct. The error is at 11:59. the graphic at 10:58 is correct.

@rahulhotchandani5639 3 года назад

@@fredericpette6483 Just one question though, 525k investment at 4M pre money should lead to equity of 11.6%, not 9.6%. Am I right?

@fredericpette6483 3 года назад

@@rahulhotchandani5639 You would be right if the capital increase would stop with Gus. However, it is the investment from Madrigal that triggers the convertible note, so you have to go through the capital increase with Madrigal to get the real (final) percentages, which are displayed on the pie chart. In this case (at 10:58), you divide 131'250 by 1'357'500 and get to the indicated 9.7% for Gus...

@ACE_77 5 лет назад

It's funny how much information this 15 min video has, really helpful, thank you and keep up the amazing work

@slidebean 5 лет назад

🙌 thanks ACE!

@kafeleboothe 4 года назад

This is great! Though your math at 10:56 is off: 525k/4MM is 13.125% -- but assigning Gus 131.25k shares assumes there was 1MM shares to divy up, but they would've issued new stock for Gus. So he would've had 13.125% of the *new* total (incl. issued), so 151k shares, bringing the total to 1.151MM shares. This is a classic markup/margin calc error, a simple mistake (I didn't touch Madrigals calc, but I'm sure the above would change her numbers as well).

@soultanapapadopoulou2931 3 года назад

I'm just stunned by the amount of information your video conveys, things that my four years Bachelor failed to explain in such a simplified and structured way.

@douglasocosta13 3 года назад

This channel is making me fall deep in love with startups, more than I was alredy. Thank you very much for the excellent material!

@AnuragBhatnagar01 10 месяцев назад

Great video - complex topic explained simply. One question - at 11m:59s, the numbers of shares to Gus & Madrigal (and their percentages) seem to have been switched, and the total is more than 100%. Would be nice if you reposted the corrected percentages and numbers of shares at that time stamp.

@davoz9773 3 года назад

All I could think of is “I hope Gus doesn’t invest in their start up” lmao

@felix20111128 8 месяцев назад

Thanks for the video! Btw, the calculation at 12:00 seems to be wrong. Gus and Madrigal's data seem to be reverse. Let me know if I misunderstood it. Gus: 525K / 7M * 1M = 75,000 shares Madrigal: 1M / 50M * (1M + 75,000) = 21,500

@andreajackson4764 3 года назад

I cannot thank you enough for this comprehensive yet approachable lesson! I look forward to watching more of your videos 🙏🏾

@dustinthegael 5 лет назад

There is an error in the graphic at 11:49, green and yellow on the pie chart were switched

@Rhh26 5 лет назад

dustinthegael thanks, ive had the video paused for 10 minutes wondering if my maths had gone wrong.

@ryanackert1536 4 года назад

@@Rhh26 lol same here bro lol. Had me all f'd up

@Dr_Adar 4 года назад

To be exact, I believe the error is the SWITCHING of of Gus's shares and Madrigal's shares. Gus should have 75k shares and Madrigal should have only 21.5k

@shivamprasad7237 3 года назад

Exactly. I've been breaking my head since long.

@culture04dc 5 лет назад

12:00 is mixed up. You switched Gus with Madrigal.

@BlumsteinPiano 5 лет назад

I thought I was the only one who noticed.. thanks

@parthgala4983 5 лет назад

Yes! There is a mistake there.

@adrianbabis9420 5 лет назад

I am relatively new to this topic, but the percentage of each founder shown in the pie chart should be less. Right?

@ramcharan6154 5 лет назад

@@adrianbabis9420 10:48 Can somebody please tell me how to calculate shares, how did gus end up getting 131,250 shares

@skillionbikes7888 4 года назад

Hey, great job seeing this mistake, I was totally confused when I recast the numbers in Excel and couldn't get the same answers, you really helped thanks

@hoelefouk 4 года назад

No breaking bad comment here, sad!

@Mykol225 5 лет назад

Great explanations and production value. Good job!

@cayahere 5 лет назад

Thanks for watching Michael!

@lindaseykota7537 4 года назад

Every Entrepreneur needs a starting point a means to generate passive income over time. Before I went in fully into real estate investments, firstly I started off with trading options and also crypto currency. I have made over $750,000 trading options and crypto currency combined my net worth now is a little over 1.7 million and I don't plan on stopping there the secret to any successful investment is consistency and also working with a good investment management team that can help you grow financially.

@oliviaborsellino6598 4 года назад

I have been in the stock market for over 6months now and everything seems overwhelming please can you help? How did you make so much profits from trading options.

@lindaseykota7537 4 года назад

I am not yet a pro trader so I can not give out financial advice of any kind, but I can point you in the direction of those who can.

@lindaseykota7537 4 года назад

All my trading and investment affairs are being managed by my broker and her team, they are the only reason why I've been able to make profits from the market and being one step ahead at all times. You can look her up online to verify her status "Kyle Holt Karens" or find her on telegräm as 'Kyleholtinc'

@nicholasgabelli2631 4 года назад

Linda I have been trying to get and audience with this lady for awhile now but it's next worked due to how busy her schedule is do you think she can take up my case as well.

@oliviaborsellino6598 4 года назад

Thanks Linda I will ensure that I follow up from here.

@andormerks3834 4 года назад

Yeah, I love the clarity and your friendliness ... not to mention the 'random' examples: Octopus Car Wash :D :D :D

@MrRenguard 4 года назад

On 10:57, shouldnt the madrigal share be 200,000 shares instead of 226,250. The share price is (5 million valuation/ (walter and jesse shares) = $5. A 1 million investment = 1 million/$5 = 200,000 new shares. Instead this video shows the convertible note convert first assuming a share price of (5 million valuation/ (walter + jesse + gus shares) = 4.18989 1 million investment = 1 million/4.18989 = 226,250 new shares. The convert is usually converted at the same time with the new round. So i am not sure why the 5 million valuation take account on gus convertible shares.

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@bluefkingstar 4 года назад

Bravo for the clear explanation of convertible notes. But these terms are designed SOO in favor of the VC. Convertible note is basically a debt that you still need to repay (plus interests) and when you are doing well, has a crazy huge upside like 100x. If I can get a loan from the bank, if I do well I pay back the money, if not I declare bankruptcy. Why would I get a convertible note instead of a loan?

@slidebean 4 года назад

Thanks for the comment! Welcome to discuss further with other founders or Caya on Discord slidebean.com/startup-cafe

@roylce8355 Год назад

How did you calculate to get your 125,000 shares to Gus

@mutaemma516 4 года назад

Hello,how do you come up with those number of shares?? @10:57,because total investment over valuation,it doesn't give me the same percent?could anyone explain please.Thanks

@slidebean 4 года назад

Are you on Discord yet? slidebean.com/live to join! Many of this questions will be answered there since early 2020!

@dealiq 4 года назад

You mentioned founders hardwork could be form of payment for shares. Can you clarify? How do you value the hardwork in $$$ for purpose of accounting?

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@gymnastmohamed5809 5 лет назад

Dude you’re the best mentor that i have never got, but seriously man that was the best explanation of equity that i have ever heard thanks!!!

@HS-wd5mp 2 года назад

Excellent explanation. I’m an entrepreneur and this is exactly what I was looking for. Thank you.

@shawn1a2a3a 5 лет назад

Thanks for the valuable tips! I admire your work. But I am little bit confused can you explain to us at 12:00 how 1mm investment at 50mm pre money valuation can represent 6.8% stake post investment? According to my understanding, Gus should get 6.8%

@z1sania 5 лет назад

they messed up with colors and numbers too. Correct numbers are: 1.96% for M, 6.84% for Gus, and 45,6% for each founder

@cayahere 5 лет назад

You are correct- this was an error in the editing. Already added a note clarifying it.

@AndriyYaroshenko 5 лет назад

@@cayahere Video is really cool! Thanks! Users who use Adblock - they don't see the notes) .. it's much better to update the video ..

@AndriyYaroshenko 5 лет назад

@@z1sania What's the correct amount of shares should be issued for M & G?

@z1sania 5 лет назад

@@AndriyYaroshenko Privet! just reverse the numbers. 75k for G and 21,5k for M

@rwmm8642 4 года назад

So then if we are investing say $1000.00 dollars in early startups are returns wont be that great? For instance, they pitch that if we get into these startups on seedinvest, startengine, etc etc that we have the chance to become ultra wealthy. So many of the companies offer convertible notes like you mentioned in this video.

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@Gitohandro 4 года назад

So what if I promise my investor 5% then 5 years later I promise another investor 5% ...does it dilute the first investors 5%?

@slidebean 4 года назад

You should ask this to Caya or other founders on Discord! Join at slidebean.com/startup-cafe :)

@learn_techie 4 года назад

What is indemnity letter in convertible notes? I've asked to write indemnity letter, can you help me with this in understanding? And how I should shape my letter?

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@IamnotaCat888 4 года назад

Excellent. Do you have a video on raising bonds like green bonds for entities towards developing equity?

@slidebean 4 года назад

Not yet! Please vote/add your favorite topics here: slidebean.com/youtube-suggest-a-video

@anitakanu5252 4 года назад

Hi, wonderful video by the way. I have a question tho; while calculating the value of stock that Gus owns, how did you arrive at 125,000 and 11%

@erikgonzalez3450 4 года назад

1M shares equals $4M. This means 1 share equals $4. Gus purchased $500,000 worth of shares. $500,000/4 = 125,000 shares. He arrived at 11% because 125,000 shares out of 1,125,000 shares is 11%.

@yunusberndt3048 4 года назад

@@erikgonzalez3450 Yet, the valuation would in that case be 4.5M...

@chemsss8582 2 года назад

@@erikgonzalez3450 You are a LEGEND. Thanks for the explanation

@adi2807 5 лет назад

Hi, Is there an error in no. of shares per person calculated at 10:58 ? you seems to assume that first convertible note converts resulting in no. of total shares of company increasing. Then Madrigal invests $1M with $5M pre -money valuation at the new price/share which is now lower since no. of shares are now more than 1M. I verified the math to work (to get no. of shares in slide) only in this case. Shouldn't both convertible note and investor get shares at the same time when convertible note is being triggered as part of the seed round?(This results in Madrigal buying at $5 per share, Gus buying at $4 per share, resulting in founders each with 37.6% of company, Madrigal with 15%, Gus with 9.8%) Am I missing something here?

@Virk111 4 года назад

Hi. s I DE incorporated a startup with 10 mil authorized shares ? how can I issue some of that to me ? I am the only person in the startup as of now.

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@yuvrajagarwal6816 4 года назад

What happens when the company goes public?? How does Stocks behave then??

@slidebean 4 года назад

There will be a video about that soon! Stay tuned! You're also welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@XsmaelTheBest7 4 года назад

14:02 Or the cap is reached ?

@mickeyderks8591 5 лет назад

Could you do a video on how you get your first customers/traction? Buy ads, marketing, etc. how did you do it? :)

@cayahere 5 лет назад

Will do. A little bit of that story here: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-viyKWTfT-g4.html

@taistanback2054 4 года назад

Don’t pay for customers!

@loubani 4 года назад

Could you explain the percentages in the pie chart on minute 10:57?

@luiscader 2 года назад

This was surprisingly one of the most accurate and easy to understand explanation of SAFEs and raising Financing. Amazing, well job! super impressed that you have this knowledge at a young age. Great job man!! Will definitely share and subscribe.💯

@AdaptedStudios 4 года назад

Brilliant video! When you said issuing a million shares when incorporating a business, would I be able to issue that much if I decide to create a company ?

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@AdaptedStudios 4 года назад

Slidebean: Startups 101 can’t seem to find the discord link on the site ?

@ashrafghaban1030 4 года назад

Thank you, Caya, for the simplified explanation. I believe that in your second example with the CAP value, the shares, and stock percentage for GUS and MADRIGAL should be inverted.

@slidebean 4 года назад

Thanks for sharing!

@Arcdiab 5 лет назад

Thanks for your effort, the video is very helpful! However, there are some mistakes; First, in the second scenario when you applied the valuation cap for Gus you mixed up the percentages of Gus and Madrigal. Second, as Gus is limiting the dilution rate on his shares with the valuation cap he had negotiated before, then the shares of the founders have to dilute furthermore to balance the math, if you sum up the percentages in your example you will get over a 105% ownership of the company, how is that possible?

@ayanda1271 4 года назад

A new world has been open to me on RU-vid. The clarity is refreshing and is exactly on the subject I need at this stage of my start-up

@dmitriysolodukha9646 5 лет назад

Nice music. Actually almost no one explains how convertible notes work. I had to read lots of sources to get it. Thanks, man.

@cayahere 5 лет назад

Great, glad it helped!

@ozzyfromspace 5 лет назад

Not trying to nitpick but isn't the pie chart at 12:00 off by like ~5%? I didn't actually add the percentages but it just didn't look right.... I'm sensitive to numbers so it made it really hard to follow, so what am I missing? Thanks :)

@etch-a-life 8 дней назад

I reali would have liked to discovered this 5-10 years ago, I know I should not say this, but I feel it's too late to do something significant, with the speed at which the world is going.

@allencartwright2174 5 лет назад

This was amazing video! I've been looking for explanations on understanding start up funding when it come to these terms but there is nothing thanks a lot Slidebean!

@cayahere 5 лет назад

Allen Cartwright thanks a lot for watching, glad it helped!

@bogereayub1369 4 года назад

Does the first invester get a discount to all new rounds or on the first round only.

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@judemark 4 года назад

Awesome video, but what I would like to know is how does class A and B shares work in all of this.

@slidebean 4 года назад

Good Q! Welcome to discuss with other founders or Caya on Discord slidebean.com/startup-cafe

@judemark 4 года назад

Slidebean: Startups 101 ok cool I just signed up I’m gonna post that question on discord.

@smediumlarge 3 года назад

I learned things here in this video that I didn't even learn in business school.

@davetheman2615 3 года назад

My man, you are a superb Educator!! All done in an Easy to understand way. These video's are simply brilliant, and a fantastic Aid to myself and i'm sure others who are embarking on a Tech start up journey, look forward to more video's

@slidebean 3 года назад

Thanks a lot!

@abdifataahify 4 года назад

Great explanation and content. The perfect overview I needed before I start narrowing my research

@slidebean 4 года назад

Glad it was helpful!

@born2freerun 5 лет назад

Percentages on capped conversion is incorrect gets you to a total of 105.6%. Walter and Jesse should be 45.6%.

@dannylevy 4 года назад

Impressed. I keep trying to explain this to friends. Glad to have found your video. Very well done. Especially the "Breaking Bad" touch. Loved it.

@slidebean 4 года назад

Awesome, thank you!

@pharrellwowwow 3 года назад

Hi Slidebean, how do you calculate the number of shares for Gus and Madrigal after dilution like on 10:57 and 12:00?

@praveenkumarpanna3618 4 года назад

Thanks dude! Very informative.

@slidebean 4 года назад

Glad it was helpful!

@sureshsasidaran1726 3 года назад

AT 12.00 the investment % and shares between GUS and MADRIGAL is inverted GUS gets 75000 shares and MADRIGAL 21500. The math was wrong ....

@reaper081091 4 года назад

Hi Mr. Caya, How do did you determine the proper pricing for your service?

@slidebean 4 года назад

Hi! We tell a little bit about that here: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-xD8A7eX26VA.html

@reaper081091 4 года назад

Slidebean: Startups 101 Thank you. 😁😁😁

@linanadiahzainalabidin4275 2 года назад

Hi, if valuation is USD 5mio, and after calculate the number of shares being diluted to 1.357,500 , hence, price/share will become USD 3.68. am I right by going with the formula (USD 5mil / 1,357,500) = USD 3.68. Calculate back Madgrical # of shares 226,250 x USD 3.68 = USD 833,333.33...... her investment value shrunk from USD 1mio to USD 833,333.33 ? did i calculate it right ?

@antoines8843 3 года назад

Can someone please explain to me the 226,250 shares of Madrigal. How to you end up with thus number? I thought: Pre-Money Valuation $4M Thus, Post-Valuation $5M. So, if Madrigal invests $1M she should have a $4 price per share ($4M Pre-Money Valuation / 1M Pre-Money Fully Diluted Shares - Jesse - 500K and Walter - 500K) Thus, with $1M, Madrigal would have $1M / $4 = 250,000 shares. Can someone please explain what I am doing wrong?

@Threshold370 4 года назад

For Senario A at 10:50, Gus convert his $525k into 131,250 shares. After Madrigal invest $1M at a $5M valuation, Gus's shares only worth (131,250)/(1,357,500)*$5M= $483,425.41, which less than what Gus has invested in the beginning. Is Gus forced to convert in shares, or he has the option to take back the money in cash?

@moorabinda Год назад

Slide at 12.00 - % don't add up to 100%. Also Gus should have 75k shares (7.5% of 1m) and Madrigal would have 2% of 1,075,000 shares, which is 21,500 shares. If my numbers are correct, this video should be updated with correct colours/tables - otherwise very useful video and I love the channel.