Legal debt mirrors technical debt

By Rick Colosimo / October 22, 2015 / Comments Off on Legal debt mirrors technical debt

Legal Debt is an Analogue of Technical Debt Shortcuts in coding – not using DRY, not refactoring, not testing – are common sources of technical debt, which require additional effort, in the form of attention, thus time and money, to address. Shortcuts in the formation and operation of your startup create legal debt, which is…

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Using accounting terms in contracts

By Rick Colosimo / May 3, 2015 / Comments Off on Using accounting terms in contracts

I recently came across a situation where we used “net revenue” in a bonus plan as part of the calculation to determine what the bonus pool would be. In other contracts, we’ve used “net revenue” to distinguish from “revenue” (aka gross revenue) to deduct things like discounts, credits, returns, and so on. In many of…

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Don't accept passive-aggressive drafting

By Rick Colosimo / October 24, 2013 / Comments Off on Don't accept passive-aggressive drafting

I recently came across this language (unaltered) in a contract: The Parties understand and agree that all Confidential Information (i) is to be preserved and protected; (ii) is not to be disclosed or made available, directly or indirectly, to anyone other than Authorized Employees, including, without limitation, third parties or unauthorized employees for purposes unrelated…

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Simple cap table for VC round calculations

By Rick Colosimo / October 23, 2013 / Comments Off on Simple cap table for VC round calculations

Over the years I’ve had many occasions to figure out the price of an offering of preferred stock for a typical venture funded startup. This is different from, and definitely not to be confused with, the valuation of the company on a pre-money basis. That’s a topic for a later post.  In its most simple…

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