Bill Liao, the partner that we work with at SOSventures, just published an interesting blog post about the relationship between an investor and the companies they invest/want to invest in. It’s called Road to Investment.
The interesting thing is that part of this article is the opinion of MavenHut’s lawyer, David Ryan, the guy that helped us raising investment and advices us around a lot of issues (along with our Romanian lawyers, obviously). David actually evaluates SOSventurs’ documents from the point of view of “the other side’s” lawyer. And it’s good.
As an established Series A investor it was clear that the deal we were doing with SOSv was the same consistent approach they had adopted with others.
Our advice is to have the tricky conversations at the heads of terms/LOI stage and beyond that it should be streamlined otherwise it’s not a great start.
Once the start-up is properly advised and understands that certain things are a fact of life with Series A investors (Liquidation Preference, Vetoes, Anti-Dilution, Limited Warranties and Reverse Vesting of Founder Equity) then the process will run smoothly.
There is no real need to waste money negotiating for the sake of doing so and at FOD we avoid getting into this trap. Get good commercial legal advice and get the investment in so that you can start to shift the needle and this is exactly what has happened with Mavenhut.”
Read the article here, it really is worth reading it.
Photo: that’s me and Bill Liao (photo taken from ComputerBlog.ro)