Founders, investors, and startup employees, major update alert: Recent changes to the QSBS (Qualified Small Business Stock) rules mean you no longer have to wait the full five years to benefit. You could now qualify for tax breaks in as little as three or four years. And the ceiling on eligible investments was raised from $50M to $75M, while the tax exclusion threshold jumped to $15M. These shifts could significantly impact how you approach fundraising and equity planning.

Considering the 504 exemption to raise money from non-accredited investors? It’s light on federal requirements—just a simple Form D—but leaves you exposed to strict and expensive state-level securities laws. Progressive states like California or New York may require their own private placement memorandums, driving up costs. Unless raising exclusively in more flexible states like Texas or Florida, 506(b) is usually the safer choice, offering one nationwide filing instead of navigating a patchwork of state regulations.

Raising from unaccredited investors? Rule 506(b) lets you do it without registering in every state by preempting state law, but it comes with strict requirements. You’ll need a detailed private placement memorandum and financial statements, outlining your business plan, risks, and capital structure. It can be time-consuming and costly but offers broader flexibility for early-stage fundraising.

Planning to raise money for a startup? Make sure to understand how securities laws apply when offering equity, SAFEs, convertible notes, or similar instruments. Knowing when registration is required; and how to qualify for exemptions can save time, money, and legal trouble. One key factor is whether investors qualify as accredited, based on income or net worth. The rules around accredited investors directly impact the fundraising strategy, especially in early rounds like friends and family. Get clear on the basics before moving forward.

James shared how carefully reviewing a term sheet helped him identify concerning provisions, like non-standard liquidation preferences and jurisdiction clauses that could have been disastrous for future funding opportunities.

If you’re not wise about the details in your term sheet, you could set yourself up for failure. That’s why having a lawyer to structure and review these documents isn’t optional—it’s essential.

From my talk at Techsgiving Summit, here’s a critical insight for startups: choosing the right business structure can save you money from the start! Whether you’re deciding between an LLC or a C Corporation, understanding the financial and operational implications is key

Thrilled to have spoken at the Techsgiving Summit this year! During my session, I shared a dose of harsh reality for startups: having a great idea is fantastic, but zero percent of zero is still zero if you don’t secure investments to bring that idea to life.

I offered actionable advice on how to position yourself for funding success and avoid the pitfalls of overvaluing your idea without tangible backing.

LOIs (Letters of Intent) play a critical role in the M&A process, but understanding key terms like an “Asset Peg” can make or break a deal. An Asset Peg is essentially a safeguard, ensuring the buyer’s investment is protected if a company’s assets fluctuate before the transaction closes.

In our recent webinar, Charles Lyons and I broke down why these details matter and how to navigate them effectively. If you’re diving into mergers and acquisitions, it’s essential to stay informed and strategic.

Thinking of incorporating your startup in Delaware? You’re not alone—it’s one of the most popular states for founders thanks to its flexible legal structure and investor preference.

But here’s what they don’t always tell you: If you issue a large number of shares without a par value, Delaware could hit you with a huge tax bill.

The fix? Assign a par value—even something as small as $0.0001. This simple step can save you thousands!