All Startup Financing Articles

Debt financing is the most common form of small business financing. It involves borrowing funds from a lender and repaying the borrowed amount—plus interest—over a set period of time by means of regularly recurring payments. Common forms of debt financing include loans, lines of credit, and credit cards. What Is Debt Financing? Debt financing provides…

A convertible note is a short-term debt that has an interest or discount rate, a valuation cap, and a maturity date. Investors use convertible notes to invest in startups in the early stages of development. Investors can choose to convert convertible notes into preferred shares on a specific date or event. What Is a Convertible…

Series A, B, C & D investments represent the first funding rounds that startups receive from investors. Each round involves the issuance of preferred stock sold to investors by a startup, with subsequent letters representing subsequent rounds. Startups use these funding rounds to hire staff, launch products, and market to customers. What Series A, B,…

Preferred stock is like common stock because it offers investors equity in a company. It may be less risky than common stock, however, because preferred stockholders receive profit distributions or liquidated assets in case the business fails before common stockholders. Companies of all sizes issue preferred stock, which institutions with large amounts of capital purchase….