What vehicle should startups use for seed stage fundraising?

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Why do you recommend Series Seed?

Why do you not recommend Series Seed?

Equity rounds result in an investor being issued stock in exchange for money at a given valuation. In a nutshell, the investors will agree to a sing...

When you set the price, both sides know what deal they got.

As a counter to the trend of convertible notes with variable pricing there is actually an advantage to a single price for the deal. From Fred Wilson&...

Transparency

The series seed documents are standardized and publicly available so there are no hidden terms to bite either the investors or the founders.Equity de...

No cons added yet

Why do you recommend Convertible note?

Why do you not recommend Convertible note?

Convertible notes are a form of debt that converts into equity given a certain trigger, usually a second round of financing.

Variable pricing

1
The biggest advantage to convertible notes is the ability to easily give different investors different prices. This provides two very important benef...

Continuous raising

2
Convertible notes allow you to bank cheques as they come in, instead of waiting for the entire round to be closed. This is especially handy as organi...

Full Rachet on down rounds

If a convertible note has a cap and a conversion discount it can be very painful for the entrepreneur on a subsequent down round. From Mark Suster:A...

Why do you recommend Convertible Equity?

Why do you not recommend Convertible Equity?

Convertible equity is a form of early-stage bridge funding that allows a startup to sell to investors a form of equity security that in many ways res...

No Complex Interest Terms

With convertible equity there is no interest paid on the round. This saves the entrepreneur equity and simplifies future fundraising.The lack of com...

Doesn't place the Startup in Debt

Convertible notes place a Startup in legal debt. This has three primary problems:When the Convertible notes maturity date is reached, investors can l...

No cons added yet

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