Delaware C-corp, LLC or California corporation?
Most venture investors expect a corporation that can issue preferred stock, and many startups choose Delaware for it. An LLC or a California corporation can…
Good questions. Clear answers.
Practical guidance, worked examples and useful legal details. With original sources to explore.
The 83(b) election: 30 days that matter
When founders receive stock that is subject to vesting, an 83(b) election lets them be taxed on its value at the start rather than as it vests. The deadline…
Founder vesting: the four-year schedule and the one-year cliff
Four-year vesting with a one-year cliff is common market practice, not a legal requirement. What matters is how the documents implement it: the repurchase…
Founder IP assignment and the California carve-out
Investors expect the company, not the founders, to own the code, designs and inventions it relies on. In California, employee invention assignments must…
California non-competes: what changed in 2024 and what still works
California has voided employee non-competes for decades, and 2024 amendments added a notice duty, a private right of action and a rule that reaches contracts…
Contractor or employee? California's ABC test
In California, a worker is presumed to be an employee unless the hiring company proves all three parts of the ABC test. A contractor agreement or a Form 1099…
Post-money SAFEs: caps, discounts and dilution
A SAFE gives an investor a right to future equity, usually when the company raises a priced round. On a post-money SAFE with a valuation cap, the investor's…
Option pools and 409A: why the strike price must be fair market value
Stock options are a common way to share equity with a team. To avoid harsh tax results under section 409A, an option's exercise price should never be less…
Your first raise: Rule 506(b), Form D and the California notice
SAFEs and seed shares are securities. Most startups sell them under Rule 506(b) of Regulation D, which means no general solicitation, a Form D filing with the…
Delaware franchise tax: choose the method before you panic
Delaware corporations file an annual report and pay franchise tax on or before March 1. The default authorized shares method can produce a very large bill for…
Offer letters in California: at-will, wage notices and final pay
A California offer letter should match the at-will relationship, avoid promises the company cannot keep, and sit alongside required notices. Final pay…
Startup NDAs: what to check before you sign
An NDA should protect specific information for a specific purpose. Check whether it is mutual, what counts as confidential, any residuals clause, how long it…
SaaS customer agreements: liability caps, indemnities, SLAs and renewals
A SaaS agreement allocates risk between a young vendor and its customers. Focus on the limitation of liability, the indemnities, what the service level…
CCPA for early-stage startups: thresholds, privacy policies and DPAs
Many early-stage startups are not yet a business under the CCPA, but some cross a threshold quickly, and a separate California law requires a privacy policy…
Term sheets: what binds you and what does not
A priced-round term sheet is usually a non-binding summary of the deal, with a few binding provisions such as confidentiality and a no-shop. Read those…