Starting from 4399: How do entrepreneurs avoid equity battles

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Mattau

Recently, micro-credit Weibo, are turning on the 4399 of the original backbone of the Cao and major shareholder Cai wins the stake controversy, said Cao withdrew only to get the original commitment of one of the 66 points. This thing I do not know the inside, can't judge who is wrong, but, this aroused my thinking.

A close review, found that in my understanding of the start-up companies, from the start to the overall capital operation, the early departure of venture shareholders is not uncommon, those who leave, often small shareholders, when they leave, generally not get too much money.

And often they leave, is after a lot of disputes, at the outset, we are a passion, common ideals, together with the future, and the struggle of the day and night, have been this dispute to smash, and finally even a stranger.

So as entrepreneurs, especially small shareholders, how can we avoid future disputes?

Venture capital, there is a very special phenomenon, it is about venture capital contracts and shareholder contracts, which have very detailed on the entrepreneurs (major shareholders) and investors in various cases of the binding provisions, but for small entrepreneurial shareholders, the special provisions, few, the reasons, I am not very clear. In fact, a lot of minority shareholders are held by large shareholders, so the investment agreement can not be bound, in this case, small shareholders and large shareholders have good communication mode is very important, I think we should pay attention to the following points:

First of all, the big shareholder's character is very important, with the character bad big guy, that behind will be very troublesome. There is his interest, whether he is willing to share with you. Judging character can only see his past experience, look at the interests of view, then see how many shares he actually brought out to the brothers, the others are virtual. A game company in the start-up, the CEO individual took out 20% of the shares to the early brothers and sisters, this is the most I have seen the case, the eldest is worthy of respect and trust.

Small shareholder entrepreneurs to join the team, often listen to the boss a call to come over dry, relying on is trust, but this is far from enough, after all, is a lasting entrepreneurial process.

First, the small shareholders should have a deep understanding of the entrepreneurial process, at the same time, the relevant investment and financing norms, equity gifts, purchase, dilution and options and even related to the basic concepts of taxation should be clear, corresponding to the rules of the game to know about, in fact, many times, especially the small shareholders do not have this experience and knowledge, Many of the major shareholder's understanding and resentment stems from this. For example, the 4399 mentioned in this article, which said the commitment to shrink 66 times times, the standard is according to the 2011 Cao exit 4399 Financing the highest valuation 40亿来 calculation. People with a little PE experience know that investing at such a high valuation must be accompanied by a strict gambling agreement, if someone out of the middle, it means that the withdrawal does not need to bear the gambling agreement, the Agreement on the gambling obligations by the remaining people to bear, if the PE experience is not to take the highest valuation to do the benchmark, Because it is very inappropriate to do so.

For venture capital, many of the early investment terms are: If the big shareholder quits, then investors have the right to initiate liquidation and end the company. These principles used to small shareholders, in fact, is not to support the withdrawal of small shareholders, to meet entrepreneurship: Everyone bundled together, the goal of common retreat. Therefore, the small shareholders put forward early exit, in fact, many times is not the question of how much money, but should not give money. The above basic knowledge of investment and financing and the rules of the game, as a major shareholder of a start-up company, should also be paid attention to, to advance and the entrepreneurial team to speak clearly, in advance, often a lot less disputes.

There is an old saying: First villain, after gentleman. In fact, the first small people, is to be a gentleman behind. When small shareholders join the team, out of the trust and respect of the team boss, basically did not seriously discuss the interests of the details, we all think the other side is a gentleman, due to the sensibilities, not to discuss the worst situation in the internal and external environment, the most ugly appearance of human nature, so we end up turning into a villain. In fact, entrepreneurial situation is changeable, external conditions, team members, even the project itself is changing, therefore, the value of each person in the enterprise, in fact, is also a change, so the small shareholders should be very serious details and major shareholders to discuss, if their value to improve or lower, the corresponding benefits how to adjust, with what the rules of the game, It would be best if the consensus reached was to be written. In 4399 of cases, we did not agree to advance the details of the withdrawal, then this time can only launch a new negotiations, the outcome of the negotiations and small shareholders of the residual value, as well as the size of shareholders and the strength and character of the relationship.

Before the deadline, the author and the well-known it gossip "Zolin right Beaver" in the Zolin communication, Zolin said: I just and Cai played one hours of the phone. Zolin said: "In fact, old Cai not easy!"

Author: Mattau. Famous angel Investor. Investment cases include the valley game, I have takeout. (micro-signal maitao2008)