Have you structured your business so that it is fundable by outside investors?
Are you sure your company owns all the assets that it uses or will need? Investors will want to know.
Are your contracts written in such a way that investors will feel comfortable with them?
We can help you set up your company in a way that suits investors and saves you time and money. We can advise you on the best financing structure for your company and its needs.
Angel Investors, Friends and Family
Complex state and federal rules govern all security offerings, even to close friends and family members. Offering ownership stakes in your business must be done in accordance with certain rules and procedures. For example, a company offering shares of its stock must make detailed disclosures and the investors must make specific representations. Filings with the Commissioner of Corporations must also be made.
OCCIDENTAL can help you put together a securities offering package that will comply with all legal requirements.
Venture capital firms are exercising more diligence than ever before. They will be very concerned with the Company’s adequate IP ownership rights and protection, as well as whether sales are secured by adequate contracts. They expect to see completed products, closed contracts and revenue on the books. They will also be concerned with any unusual stock option rights granted to third parties or employees. They are likely to require a large piece of your company, demand considerable say-so in management decisions and evaluate your company based on the way you handle negotiations.
The lawyers of OCCIDENTAL have advised many VC funds and portfolio companies in connection with their corporate finance transactions. We understand VC requirements and can help find investors. We can help you navigate the VC term sheet and close a financing deal. Having a lawyer on your side can maintain your relationship with investors, give you more credibility, and mitigate the “bullying” factor.
Choosing the Right Deal: Equity, Debt, Licensing
Deal structures have changed since the dot-com days. Certain VC firms and institutional investors prefer rights in intellectual property rather than equity in return for early funding. Although equity deals are preferable, with certain protections for key personnel, limited licensing may be an acceptable form of funding as long as it does not affect the company’s long term ability to carry out its business activity.
