Question

When early stage startups look for funding (choose all that apply):

a. They tend to issue preferred stock to founders and employees, and common stock to investors.

b. Angels and VCs often provide better funding opportunities than crowdfunding.

c. Friends and family are often the first stop, because they believe in the founders

d. Some banks may provide secured loans and/or venture debt

e. Grant funding can create problems on the cap table through high dilution.

Answer 1

When early stage startups look for funding :C,d &e

c. Friends and family are often the first stop, because they believe in the founders

d. Some banks may provide secured loans and/or venture debt

e. Grant funding can create problems on the cap table through high dilution.

Not Apply a & b

Explanations:

a. They tend to issue preferred stock to founders and employees, and common stock to investors.

No, investors tend to hold Preferred Stock, whereas founders hold Common Stock. Employees often have options that grant them the right to purchase shares of Common Stock.

b. Angels and VCs often provide better funding opportunities than crowdfunding.

No,Every startup is going to have its own unique needs, so for some one crowdfunding can be a better option for someove vc and for other one can be angels.

c. Friends and family are often the first stop, because they believe in the founders.

yes

d. Some banks may provide secured loans and/or venture debt

Yes

e. Grant funding can create problems on the cap table through high dilution.

Yes

Cap tables are created in the early stages of a startup or venture. After few rounds of financing, the cap tables can create problems.