In response to the blog post on “Venture Capital 101″ we got a question, “What is a typical rate on preferred returns? I had an investor ask for a 130% preferred return plus equity. Is this normal?”.

Returns and the related concept of valuation seem to be a good topic for a blog note so I’m responding here rather than in the comments. I’ll provide some background before answering the specific question. Continue Reading »

Our firm spends a lot of time working with entrepreneurs to define “accretion points”. Essentially, these are moments in time where an accomplishment or a set of accomplishments make it obvious to everyone that the company is worth much more than it was prior to achieving these things. Our fundraising strategy for early stage companies is often defined by accretion points. Continue Reading »