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Is it normal for founders to have preferred shares? In our case the founders all have common stock (albeit a lot of it), and in fact it came with more restricti
by lemming 16y ago
Is it normal for founders to have preferred shares? In our case the founders all have common stock (albeit a lot of it), and in fact it came with more restrictions than normal common stock, namely a 3-year restricted stock period similar to an option vesting period.
- tptacek 16y agoDunno, but note that founders often hold board states, and VC has an incentive to make sure they can take some money off the table, else they can make it harder to complete the best deal VC thinks they can get, in the name of holding out for an actual return.
- danshapiro 16y agoThat's very normal; founders usually have mostly common, and sometimes have extra restrictions. The other commenter is right, though - anyone with influence in a transaction typically comes out better, and founders are often in such a position.