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Fundraising Queries Answered by Srinivas Katta @ TiE Bangalore

Fundraising happens to be a long process with several inevitable aspects to bear in mind throughout this complex affair. 

Recently, RuleZero’s founder, Srinivas Katta engaged in an interactive session – Masterclass: Get Your Funding Queries Answered at TiE Bangalore. The session began with an introduction to RuleZero’s startup terms repository – The Startup Periodic Table and continued towards understanding nuances that are a part of the fundraising process. 

An interesting question raised during the session was “If a company can issue CCPS or equity to an existing customer or not?”.

Addressing this, our founder discussed how the customer can only be issued phantom stock provided they cut a cheque. This means the customer will only be receiving the appreciated value of stock as returns. Another option could be cutting the customer a share in the revenue of the company.  While both these options are feasible, at the end of the day, it is a business call and a play on the revenue model of the company.

Some other queries addressed in the session were:

  1. How to devise equity plans for employees?
  2. How important is pre valuation round when a company progresses?
  3. Are convertible notes favourable to one party at a later stage?
  4. How are convertible notes treated under law?

The session saw active participation and compelling questions from the audience. 

You can watch the video linked below to know more.

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