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I have a question. What if the startup getting convertible debt never raises a round of funding and perhaps gets acquired or does an IPO?
by paraschopra 16y ago
I have a question. What if the startup getting convertible debt never raises a round of funding and perhaps gets acquired or does an IPO?
- danbmil99 16y agoI would assume the conversion is calculated at the value of the acquisition or IPO (which is really just a type of investment round). [edit: as it says, no discount so forget this part] Typically there's a conversion percentage kicker, so it might be 110% of the value (ie the early investor gets more for the risk)