September 18, 2013 - On April 5, 2012, President Obama signed into law the Jumpstart Our Business Startups Act (the “JOBS Act”). The primary intent of the JOBS Act is to drive job creation by making a number of significant changes to federal securities laws which shall facilitate startups and other emerging growth companies raising capital. In addition to changes which ease restrictions placed on private placement offerings and Securities Exchange Commission (“SEC”) shareholder registrations, the most highly anticipated provisions of the JOBS Act is the enablement of “crowdfunding,” or the ability to sell securities in small amounts to a large number of investors. The changes brought by the JOBS Act will likely have a significant impact on how startups raise capital.
September 18, 2013 - In my first two posts on Understanding Venture Debt, I provided a general overview of different types of venture debt facilities and a brief look at the banks and funds that are actively involved in the space. With this post I hope to shed some light on one of the less-obvious, but highly important, aspects of the venture debt landscape: the “implicit contract” between venture capitalists and venture lenders.
September 6, 2013 - We all enjoyed another Labor Day holiday weekend in which politicians and union leaders of all stripes voiced the traditional platitudes about working families in America. You may be surprised to learn that just because you work and you have a family,you are not necessarily a “working family”.
September 5, 2013 - In my first post in this series about Understanding Venture Debt, I provided a quick overview of the various types of debt facilities available to venture backed companies. With this post I will provide an overview of two types of institutions which provide the debt financing and the relative cost of capital of each, as this plays a vitally important role on overall venture debt deal terms.
September 5, 2013 - When it comes to regulations, it pays to stay diligent. Last year’s implementation of Dodd Frank exempted venture capital firms from SEC registration for all the right reasons; however, other regulatory changes and trends are likely to affect venture capital firms. While not specifically targeted by the regulations, the impacts to venture capital firms may be fewer product options, increased regulatory compliance and changes to confidentiality norms. Let’s consider three major issues facing the industry: Basel III, KYC & AML, and FATCA.
August 22, 2013 - With a string of profitable quarters on the books, it seems that the fiscal weight of Fannie Mae and Freddie Mac peaked at $187.5 billion. These government-sponsored enterprises (GSEs) became wholly-owned subsidiaries of the U.S. Treasury in 2008. Fannie and Freddie are the only part of the financial sector bailout that hasn’t yet shown a profit for taxpayers, but that milestone will be reached later this year.