AngelBlog: Exchangeable Shares - a Better Way for Angel Investors
Lucas
· 5 months ago
Speaking as an entrepreneur, I don't see that this would harm my own interests, and it might help raise seed money. On the other hand it might make it harder to raise followup rounds.
Any thoughts on how series A investors would react? What's your experience so far?
chrisco
· 5 months ago
Basil, I'm also curious as to next-round investor reactions. What are the metrics and anecdotes? I.e., how many exchangeable-share deals in your database have received next-round investments and what was the outcome (sanitized numbers) and what are the anecdotes? Thanks.
-Chris
PS: How's the fishin? When ya comin' to Sweden?! :)
basilpeters
· 3 months ago
Great question, Chris. While the mechanism of exchangeable shares is well established, the idea of using it in an early stage financing structure is still new. I have used it almost exclusively for almost a decade now. Other angels, and angel fund managers, that I work with have also been using it for several years.
So far, we have never 'lost' this feature on a next round investment negotiation. But I admit the sample size is very small. These days, very few angel backed companies are getting follow on investment from VCs, so this is coming up less and less often.
P.S. Fishing here has been outstanding. I'll email you a photo.
All Comments
Any thoughts on how series A investors would react? What's your experience so far?
-Chris
PS: How's the fishin? When ya comin' to Sweden?! :)
So far, we have never 'lost' this feature on a next round investment negotiation. But I admit the sample size is very small. These days, very few angel backed companies are getting follow on investment from VCs, so this is coming up less and less often.
P.S. Fishing here has been outstanding. I'll email you a photo.
RE the fishing pics: Nice catch!
Cheers,
Chris