
YC Series AA Equity Financing Documents - _pius
http://ycombinator.com/seriesaa.html
======
chris123
Will be nice when they release the new convertible notes they've been talking
about and Paul G promised to release soon here:
<http://news.ycombinator.com/item?id=1657906>

------
thorax
These are awesome but also not new-- YC released them a couple years ago.
Here's some discussion on them, for example:

[http://www.startupcompanylawyer.com/2008/08/23/how-do-the-
sa...](http://www.startupcompanylawyer.com/2008/08/23/how-do-the-sample-y-
combinator-series-aa-financing-documents-differ-from-typical-series-a-
financing-documents-or-whats-the-difference-between-seed-and-venture-
financing-terms/)

------
rdl
Releasing "standard financing documents" like this is a win in two ways -- it
saves you from the legal costs of creating documents from scratch each time,
AND provides an "objective" "standard" set of documents, so people are less
likely to waste a lot of time and energy negotiating. Or, if they do
negotiate, at least there is a fair starting point.

If foreign countries wanted to try to recreate Silicon Valley (as the Startup
Chile people are doing), they should create equivalent financing docs under
their own national laws and publish them. A well-understood legal environment
with lawyers/etc. familiar with the process is one of the big advantages of
Silicon Valley and the US.

------
adulau
This is a very good initiative.

A small note, what's the license terms of those documents? "Open-sourcing
them" doesn't mean anything and all author rights are still reserved for those
documents.

It would be more appropriate to add the terms of the licensing for the
documents. For example, the CC-PD (to put them in public domain), GNU FDL or
CC-BY-SA or CC-BY.

<http://creativecommons.org/licenses/publicdomain/>
<http://www.gnu.org/copyleft/fdl.html>

------
danshapiro
A brief summary of important terms (IANAL, this is just a quick read):

\- This has 1x preference and no participation.

\- Pro-rata rights are available to some shareholders.

\- Ditto information rights.

\- The preferred has a veto over selling the company that can be exercised
with a simple majority.

\- Lots of stuff not included: board seat, drag along, antidilution,
redemption rights, employee option pool (!), restriction on sales, or a no-
shop.

Overall mostly VERY favorable to the entrepreneurs, mostly by virtue of what's
been left out. The one notable exception is the prefered's veto over an exit,
which is a big ouch.

------
mattmaroon
We used these for our AA, helped save a lot of money.

~~~
mcxx
Can you please explain how/why did it save you money?

~~~
mattmaroon
It saved money since our lawyers (who were probably the same ones who wrote
these) didn't have to start from scratch.

