Business Financing
Seattle mobile advertising startup HasOffers publicly announced earlier this week that it has raised a $9.4 million series A round. Included in the investments were a few prominent Seattle tech investors. The round was led by California-based venture group Accel Partners, and also included Seattle-based Founder’s Co-op principal Chris DeVore, and RealNetworks founder and CEO Rob Glaser.
HasOffers has been bootstrapped until now. The company won “Bootstrapper of the Year” at last year’s GeekWire Awards for building a profitable, 79-person company… Read the rest
Many of our clients that are looking to raise a seed-round financing have heard from friends or advisors that convertible debt is definitely the way to go. We often recommend equity rather than convertible debt, and we explain why below. Convertible equity (a twist on convertible debt), if done right, can be a good deal for both investors and entrepreneurs. The important thing is that everyone involved understands the difference between convertible debt (or convertible equity) and equity. It’s in that spirit that we authored this post.
Understanding the basics
Before you can understand the pros and cons, you need… Read the rest
Last spring, Red Russak founded Startup Seattle to bring together Seattle’s startup community resources and help entrepreneurs connect and grow new ideas and businesses. The Puget Sound Business Journal reports that some big players have now joined Russak’s cause, including Chris DeVore of TechStars and Founders Co-op, Ex Lazowska of the Univ. of Washington’s computer science department and Greg Gottsman of Madrona Venture Group. Now, with the help of these big name entrepreneurs and… Read the rest
The SEC issued a report that makes it clear that companies can use social media platforms, e.g. Facebook and Twitter, to announce key information to investors to comply with Regulation Fair Disclosure (Regulation FD) so long as the investors have been alerted about the announcement and which social media outlet being used.
The SEC’s report confirms that Regulation FD applies to social media and other emerging means of communication used by public companies the same way it applies to company websites. In 2008, the SEC issued guidance that clarified that websites can serve as… Read the rest
The United States Court of Appeals for the Fourth Circuit has issued a trio of opinions in 2013 which determine the scope of FINRA’s customer code. The customer code allows customers of FINRA members to initiate arbitration proceedings against a FINRA member.
Background
FINRA is a private self-regulatory organization that has the authority to exercise comprehensive oversight over all securities firms that do business with the public.
FINRA’s Customer Code governs arbitration between customers of FINRA members and FINRA members. (There is also an Industry Code which governs disputes between FINRA members.)
Rule 12200 provides that parties must arbitrate a dispute under the Customer… Read the rest
Recent cases have triggered a growing discussion about the whistleblower protections under the Dodd-Frank Act. Most believe that the regulations under Dodd-Frank are here to stay (at least another four years) now that President Obama has been reelected. With new regulations comes new judicial interpretations of the regulations. These judicial interpretations often broaden or narrow the scope of the regulation and can have profound impacts depending on the nature of the interpretation. In today’s post, we’ve highlighted the general characteristics of the two major whistleblower protections under Dodd-Frank and how recent cases have expanded… Read the rest
Last week we wrote about Greenlight Capital’s lawsuit against Apple Inc. The hedge fund manager David Einhorn filed the lawsuit to contest Apple’s proposition to eliminate the board’s ability to issue preferred shares without shareholder approval. Today, Apple CEO Tim Cook called the lawsuit a “silly slideshow” while speaking at a Goldman Sachs investor conference.
Cook noted that the disagreement between Einhorn and Apple stems from a proposal on Apple’s proxy statement which it filed with the SEC in December. The crux of the dispute centers around how to issue preferred stock and who is able to approve new shares.… Read the rest
We’re following up Thursday’s post about Apple’s attempt to prohibit the company from being able to authorize preferred stock by amending its charter documents with this post, which discusses some of the general characteristics of preferred stock and some of the key terms that affect the value of preferred stock.
General Characteristics of Preferred Stock
Preferred stock is often considered a hybrid security as it offers features of both bonds and common stock. For example, preferred stock is like a bond in that it typically has a fixed-percentage dividend, and it is… Read the rest
According to a proxy statement issued by Apple Inc., the computer (and mobile device) giant has announced that it does not intend to issue preferred stock in the future and believes it is appropriate to eliminate an existing provision permitting the issuance of preferred stock at its discretion. The proposed amendment to the company’s governing documents would require Apple to seek shareholder approval prior to issuing any preferred stock in the future.
Greenlight Capital Inc.’s David Einhorn is protesting the amendment. Read the rest
Yesterday, President Obama named Mary Jo White, the first female United States attorney in Manhattan, to the head the Securities and Exchange Commission (SEC). Many believe that the appointment of White, a former prosecutor and the first prosecutor to head the SEC, signals a renewed resolve to hold Wall Street accountable for any wrongdoing. White is well-known for her aggressive prosecution tactics.
White spent more than a decade as a federal prosecutor in New York City, where she pursued white-collar crime and Wall Street fraud. One of her… Read the rest
