Diese Präsentation wurde erfolgreich gemeldet.
Wir verwenden Ihre LinkedIn Profilangaben und Informationen zu Ihren Aktivitäten, um Anzeigen zu personalisieren und Ihnen relevantere Inhalte anzuzeigen. Sie können Ihre Anzeigeneinstellungen jederzeit ändern.

How equity management is changing" by Henry Ward, CEO at eShares

678 Aufrufe

Veröffentlicht am

Let's face it: "Equity" is a big word. because of the variety of types of assets that exist, "equity" can have somewhat different meanings when referring to different kinds of assets: shares, common stock, preferred stock, etc.

From stock options to warrants and liquidation preference, it's not always easy to have a clear vision of who owns what in a startup.
Equity Management in the US used to be done manually by lawyers but it's less and less the case. Why it's changing? What is really at stake? How equity can be easier to understand by founders, employees... and those who need it?

For this special event, we're thrilled to welcome Henry Ward, CEO of eShares. Henry will share his experience on how equity Management is changing in the US and how this will impact Europe.

eShares is a fast-growing online platform that allows companies—from seed stage to pre-IPO—to manage equity electronically with the participation of their shareholders, employees, auditors, and legal counsel.

They are working with more than 1,500 companies and add more than 200 companies each month. Last year, they raised $17 million in Series B funding at a post-money valuation of $77 million.

Veröffentlicht in: Kleinunternehmen & Unternehmertum
  • Als Erste(r) kommentieren

  • Gehören Sie zu den Ersten, denen das gefällt!

How equity management is changing" by Henry Ward, CEO at eShares

  1. 1. HOW EQUITY MANAGEMENT IS CHANGING BY HENRY WARD CEO AT ESHARES #TFSPECIAL
  2. 2. TheFamily 
 code: lamifasisi WIFIWIFI
  3. 3. DISAGREE ON TWITTER! #TFSPECIAL
  4. 4. #TFSPECIAL HOW EQUITY MANAGEMENT IS CHANGING HENRY WARD CEO AT ESHARES @ESHARES
  5. 5. A Simple Financing Cap Table Bob 50% ? Mary 50% ? Option Pool 0% New Investors Dave ? $1,000,000 Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool 0% What will this be? New Cap Table Bob 40% $2,000,000 Mary 40% $2,000,000 Option Pool 0% $0 Dave 20% $1,000,000 100% $5,000,000 Of course!
  6. 6. Two Types of Financings Equity FinancingConvertible Note “Priced Round”“Debt Round”
  7. 7. Equity Financing Terms Pre MoneyValuation Value of the company prior to the investment of “new money” Post MoneyValuation Value of the company after the investment is made Option Pool Number of shares reserved for employee stock options
  8. 8. Add an Option Pool... Cap Table Bob 50% ? Mary 50% ? Option Pool 0% New Investors Dave ? $1,000,000 Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool 20% What will this be? Makes sense! New Cap Table Bob 30% $1,500,000 Mary 30% $1,500,000 Option Pool 20% $1,000,000 Dave 20% $1,000,000 100% $5,000,000
  9. 9. Have an Option Pool? Cap Table Bob 40% ? Mary 40% ? Option Pool 20% New Investors Dave ? $1,000,000 Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool ? What will this be? Got it. Everything gets diluted. New Cap Table Bob 32% $1,600,000 Mary 32% $1,600,000 Option Pool 16% $800,000 Dave 20% $1,000,000 100% $5,000,000
  10. 10. More Options Please Cap Table Bob 40% ? Mary 40% ? Option Pool 20% New Investors Dave ? $1,000,000 Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool 20% What will this be? Sure. Post Money is Fixed. New Cap Table Bob 30% $1,500,000 Mary 30% $1,500,000 Option Pool 20% $1,000,000 Dave 20% $1,000,000 100% $5,000,000
  11. 11. More Investors Please Cap Table Bob 40% ? Mary 40% ? Option Pool 20% New Investors Dave ? $1,000,000 Ann ? $1,000,000 Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool ? What will this be? Rounding errors aside, OK. New Cap Table Bob 27% $1,600,000 Mary 27% $1,600,000 Option Pool 13% $800,000 Dave 17% $1,000,000 Ann 17% $1,000,000 100% $6,000,000
  12. 12. Make It Hard Now... Cap Table Bob 40% ? Mary 40% ? Option Pool 20% New Investors Dave 20% ? Ann ? $500,000 Jeff 5% (max to $400K) Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool 15% And what if I negotiate the Pre MoneyValuation? What will these be?
  13. 13. Let’s Go Back Here Cap Table Bob 50% ? Mary 50% ? Option Pool 0% New Investors Dave ? $1,000,000 Financing Terms Pre MoneyValuation $4,000,000 Post Money Option Pool 0% What will this be? New Cap Table Bob 40% $2,000,000 Mary 40% $2,000,000 Option Pool 0% $0 Dave 20% $1,000,000 100% $5,000,000
  14. 14. Let’s Sell the Company Cap Table Bob 40% - Mary 40% - Option Pool 0% - Dave 20% $1,000,000 100% - Sales Price = $10M!!! Payout Bob 40% $4,000,000 Mary 40% $4,000,000 Option Pool 0% $0 Dave 20% $2,000,000 100% $10,000,000 Easy!
  15. 15. Let’s Sell the Company Cap Table Bob 40% - Mary 40% - Option Pool 0% - Dave 20% $1,000,000 100% - Sales Price = $500K :( Payout Bob 40% $0 Mary 40% $0 Option Pool 0% $0 Dave 20% $500,000 100% $500,000 Liquidation Preference!
  16. 16. A Fundamental Law Assets = Liabilities + Equity Company Assets - Total Liabilities = Shareholder Equity (think of it this way....) $100 $80 $20
  17. 17. A Fundamental Rule In case of liquidation, Debts (i.e. Liabilities) are always payed before Shareholder Equity
  18. 18. Capital Structure Assets Liabilities Equity $100 $20 $80
  19. 19. Capital Structure Assets Liabilities Equity $80 $0 (shareholders lose everything) $80
  20. 20. Capital Structure Assets Liabilities $60 $60 (debt holders lose $20)
  21. 21. Payout Graph $ Sales Price $ Payout Debt Equity $80 $80
  22. 22. Let’s Sell the Company Sales Price = $10M Payout Bob 40% $4,000,000 Mary 40% $4,000,000 Option Pool 0% $0 Dave 20% $2,000,000 100% $10,000,000 Sales Price = $500K Payout Bob 40% $0 Mary 40% $0 Option Pool 0% $0 Dave 20% $500,000 100% $500,000 Preferred Shares behave like Debt!Preferred Shares behave like Equity!
  23. 23. Capital Payout Graph $ Sales Price $ Payout $4M $5M$1M $1M Preferred (Dave) Common (Bob & Mary)
  24. 24. “Dead Zone” Protection Accruing Dividends Dividends (i.e. 6%) that accrue Participating (vs Non-Participating) Participating Preferred takes pro-rata portion of any gain after receiving cost basis Investment Multipliers Increases the protected return to the investor e.g. 2x returns twice the original investment before common is paid
  25. 25. Accruing Dividends $ Sales Price $ Payout $4M $5M$1M $1M Preferred (Dave) Common (Bob & Mary) $1M + 6% * t Grows over time
  26. 26. Participating Preferred $ Sales Price $ Payout $4M $5M$1M $1M Preferred (Dave) Common (Bob & Mary)
  27. 27. Preferred Multiplier $ Sales Price $ Payout $4M $5M$1M $1M Preferred (Dave) Common (Bob & Mary) $2M
  28. 28. A Few More Terms Anti Dilution Protects investor ownership percentage in the case of a down round. Warrants Just like Options (right to buy at a strike price) except they are add to the fully diluted (instead of from option pool) Partially Participating Liquidation Preference Behaves like Participating Preferred up to a certain threshold which is usually expressed as a multiplier of the investment
  29. 29. What is eShares?
  30. 30. We are an SEC registered Transfer Agent The first one focused on private companies.
  31. 31. We issue electronic shares, options, debt, and derivatives And track ownership, restrictions, and shareholder information.
  32. 32. We automate their approval and compliance Seller Buyer Including new issues, transfers, and settlement.
  33. 33. And track the shareholder registry And the shareholders portfolios. Cap Tables Portfolios
  34. 34. Consolidating equity services for privately owned assets Transfer Agents Brokerages Private Company Services Public Company Services IPO For companies and shareholders Exchanges
  35. 35. Our website describes us best And tells our story
  36. 36. Thanks!

×