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General VC Questions

When comparing terms in common share agreement versus preferred shares agreements what should I watch for to ensure preferred shares are not offering far better terms than common shares

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Sep 16, 2023
We are doing due diligence on one of our investment targets, and I am comparing terms in the shareholder agreements for common and preferred shares. Recognizing that the preferred shares will have some advantages over common shares, what terms should I watch for that would be considered unreasonable treatment of common shareholders?      
1 answer
Accepted Answer
Nov 11, 2023
Venture Investors typically take preferred positions in portfolio companies. The early stage investment agreements are fairly standardized. For a review of a standard preferred offering, review the Series Seed documents below:

https://www.seriesseed.com/ 

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