Category season file
Equity, fundraising, and founder control decisions.
posts in this decision room
What did this move burn?
How much equity should you give a startup advisor? Typical advisor equity ranges, vesting terms, a worked dilution example and a checklist for saying no.
What did this move burn?
An investor update is a short monthly email that tells your backers how the startup is doing. Use this investor update template, the metrics to include and a worked example.
What did this move burn?
Startup valuation multiples price a company as a multiple of its revenue or ARR. Here is how revenue multiples work, what moves them up or down, and how to sanity-check the valuation an investor offers you.
What did this move burn?
Employee stock options (ESOP) give early hires the right to buy company shares at a fixed strike price. Here is how options, vesting, exercise and dilution work for founders and employees.
What did this move burn?
Startup funding stages explained from pre-seed to Series C: what each round is for, typical round sizes, who writes the check, what you must prove, and how dilution compounds along the way.
What did this move burn?
How much should a startup raise? Size your round backwards from runway: planned burn, a 6-month fundraising buffer and dilution, with a worked $960K example.
What did this move burn?
Startup due diligence is the investor review between a signed term sheet and the wire. Use this checklist to prepare your cap table, metrics and legal files.
What did this move burn?
A startup pitch deck is a short slide deck that answers one question: why should an investor take a meeting? Here is the slide-by-slide structure, what investors look for and the mistakes that get decks skipped.
What did this move burn?
An accelerator is a fixed-term program that trades capital and mentorship for equity, while an incubator supports very early ideas over a flexible timeline. Compare terms, cost and fit.
What did this move burn?
Angel investor vs. venture capital: an angel invests their own money, usually earlier and with smaller checks, while a VC fund invests other people's money and needs outsized returns. How the two differ on check size, control, speed, and what each one does to your cap table.
What did this move burn?
Aspiring VC analysts and new angel investors get the same test: here is a startup, would you invest? A five-part framework for evaluating a startup in a case interview, the numbers to check and how to practise decisions from the founder's side.
What did this move burn?
Anti-dilution protection resets an investor's price after a down round. Here's how full ratchet and weighted average differ, and what each costs founders.
What did this move burn?
Investor trust is the metric VCs track silently between updates. What builds it, destroys it, and how the investor trap failure mode happens.
What did this move burn?
Pro-rata rights let investors buy shares in future rounds to hold their ownership steady. Here's the math, the super pro-rata variant, and what to negotiate.
What did this move burn?
A cap table is the ledger of who owns what percentage of your startup. Here's what it actually tracks, how it changes with every funding round, and the mistakes that quietly cost founders control.
What did this move burn?
Seed vs Series A compared: round sizes, what each round proves, the metrics A investors expect, dilution math, and a readiness checklist for the jump.
What did this move burn?
Pre-seed vs seed funding compared: typical round sizes, valuations, investor expectations, SAFE vs priced rounds, and a checklist to know which round you're ready for.
What did this move burn?
Read how early investment terms affect founder motivation, control, and investor trust in the next round.
What did this move burn?
Startup dilution explained with the formula, a three-round worked example, and the option pool trap that costs founders more than they expect.
What did this move burn?
50/50 or not? The factors that decide a co-founder equity split, why vesting and a cliff are non-negotiable, and how the split compounds with dilution across rounds.
What did this move burn?
How a SAFE works: valuation cap, discount, the post-money vs pre-money difference, and the dilution surprise SAFEs create when they convert at a priced round.
What did this move burn?
Pre-money vs. post-money valuation explained with the formula, a worked example, and how investors actually price a Pre-Seed or Seed funding round.
What did this move burn?
The option pool shuffle quietly cuts your real valuation before a term sheet is even signed. Here's the math, a worked example, and how to negotiate it.
What did this move burn?
How a liquidation preference works: the 1x vs. 2x multiple, participating vs. non-participating terms, and the stack deciding what founders keep at exit.
What did this move burn?
A convertible note is startup debt that converts to equity, with interest and a maturity date a SAFE doesn't have. Here's the difference, and when to use each.
What did this move burn?
A vesting schedule spreads founder and employee equity over time, with a cliff before any of it is earned. Here's how the standard 4-year, 1-year structure works.
What did this move burn?
A down round prices your next raise below your last valuation — and dilutes founders more than the percentage drop suggests. Here's how it works.
What did this move burn?
A term sheet sets your valuation, dilution, and board control before the lawyers get involved — here are the clauses that decide the real outcome.