NYCENT

As NYC Entrepreneur Week (April 20-24th) quickly nears, we have opened up limited registration for three events that were previously invite only. If you would like to attend please click on the links below to register. We look forward to seeing you on April 20th!

Jeevan Padiyar
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Monday April 20
2009

8:00 am - 9:00 am

NYC ENT Launch Announcement/Opening Ceremony

Venue: NYU
http://www.eventbrite.com/event/325153543

Distinguished Guests:

Scott M. Stringer, Manhattan Borough President

Robert W. Walsh, Commissioner, NYC Dept. of Small Business Services

9:00 am - 10:00 am

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Founding a Business During or Right Out of College

Venue: NYU
http://www.eventbrite.com/event/325163573

Moderator: Oz Sultan, Founder of NextWeb

Panelists:

Doug Imbruce, Founder of theU.net

Eduardo Saverin, Co-Founder of Facebook

Sergio Fernandez de Cordova, Co-Founder of Fuel Outdoor

Brett Hickey, Co-Founder of Aegis Capital Group
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Thursday April 23
2009
10:00 am - 12:00 am

Technology Infrastructure to Scale your Startup

Venue: Sun Micosystems
http://www.eventbrite.com/event/324826565

Distinguished Guests:

Angelo Rajadurai, Senior Technical Evangelist at Sun Startup Essentials

Anil Vasagiri, Senior Investment Associate at Connecticut Innovations

We are really excited about NYC ENT week coming up (12 days and counting...) I think we’ve done a great job of lining up speakers and panelists, and just yesterday we confirmed Scott Stringer and Robert Walsh!

 

In addition to all the events we’ve been working on, we’ve partnered with a lot of NYC organizations who have a similar mission to our own: to be a driving force of entrepreneurialism in NYC. In our outreach to these partners we are excited to cross promote several events that will be running concurrent with our very own NYC ENT week. I’ve included the links to all these events, so make sure to check out their sites to register!

 

--Nicole

 

Monday to Wednesday, April 20 - 22

All Day, a 3 day event hosted by ASTIA.  You can buy a single pass for each day or a complete package for all 3 days.  Go to their site for more details.

 

 

Monday, April 20

5:00 – 10:00 PM Blue Venture Community is hosting a speed networking event where engineers and entrepreneurs can connect. The event is open to the public, click here for details.

 

6:30 – 8:00 PM Gotham Media Ventures is launching their Innovations series with a discussion on Media 3.0 – What’s Next. You can register here.

 

Tuesday, April 21

8:00 – 9:30 AM Gotham Media Ventures is hosting a panel discussion, titled “Angel Investment - Raising Funds in Turbulent Times II”. Click here to register.

 

Wednesday, April 22

6:30 – 11:00 PM BootUpNYC is an event at the legendary Webster Hall bringing together cocktails, live entertainment and presentations from service providers and angel groups. You can register on their website.

 

6:30 – 7:30 PM Workshop in Business Opportunities (WIBO) is having an open house for their WIBO Advisers. Space is limited so RSVP.

 

 

Thursday, April 23

 

7:30am - 10:00am Ibreakfast is hosting an event titled 'Google and the Future of Newspapers' at CRESA Partners Executive Center. Click here for more info and to register

 

6:00 – 8:30 PM The Social Media Club of NYC is hosting a panel at the offices of PR Newswire (350 Hudson Street, NY, NY) Distinguished Guest is Meg Hourihan, proprietor, Megnut.com and co-founder, Pyra/Blogger.com. Click here to register.

 

Friday, April 24

1:00 – 2:30 PM CUNY is hosting an event titled “Accessing Resources and Capital for Your Business”. Click here to RSVP.

 

1:00pm - 4:00pm Ibreakfast is hosting 'The Alternate Funding Conference' where a panel of experts will discuss new fund options in today's economy. Register here.

 

 

Start-up technology companies often have difficulty recruiting and retaining talented employees. These companies need to attract high quality employees to build their businesses; however, they often lack the financial resources to offer their employees competitive salaries. One way to help level the compensation playing field between start-ups and established companies is with equity compensation.

Equity compensation is non-cash compensation that represents an ownership interest in the company. The two most common forms of equity compensation are stock options and restricted stock. Due to the variety of legal, accounting, and tax issues that are involved with equity compensation, proper planning is critical. Therefore, a company should seek legal and accounting advice before implementing an equity compensation plan.

A stock option is a right to purchase shares of a company’s stock at a predetermined price, which is referred to as the exercise price. The right to exercise the option and purchase shares of a company’s stock generally accrues, or "vests," over a period of time. The vesting of options over time creates an incentive for the employee to remain with the company to build its value. Option holders are not stockholders and thus are not entitled to vote their option shares or otherwise exercise any other rights of stockholders. All or a portion of the vesting of options often accelerates upon the sale of the company, unless the buyer assumes the options under its plan. Conversely, if an employee leaves the company, the vesting of stock options ceases, and the employee usually has a limited period of time to exercise the options that were vested on the employment termination date.

There are two types of stock options: incentive stock options ("ISOs") and non-qualified stock options ("NQSOs"). In the case of ISOs, and generally in the case of NQSOs, there is no tax to the option holder when the option is granted or when the option vests. The crucial distinction between ISOs and NQSOs is when the option is exercised. Generally, there is no tax to the option holder when ISOs are exercised. (However, the option holder may be subject to alternative minimum tax when ISOs are exercised.) When NQSOs are exercised, the option holder is subject to ordinary income tax on the difference between the exercise price and the fair market value of the stock on the date of exercise. The option holder is subject to capital gains tax on the sale of the stock that was purchased upon the exercise of ISOs and NQSOs. This tax is on the difference between the sales price and, in the case of ISOs the exercise price, and in the case of NQSOs the fair market value of the stock on the date of exercise.

Under the Internal Revenue Code, a stock option must satisfy several criteria to qualify as an ISO. Principal among these is that ISOs may be granted to employees only, and the exercise price of ISOs must be equal to or greater than the stock’s fair market value on the grant date. NQSOs may be granted to non-employees, such as outside directors or advisors. The exercise price of NQSOs may also be less than the stock’s fair market value on the grant date.

While stock options are appropriate for most employees, a company’s founders generally demand the voting and other rights of stockholders. However, the founders may desire to ensure that the stock owned by all of the founders is at risk and thus subject to forfeiture if a founder leaves the company. This motivates all the founders to work hard to build the company’s value, and if the stock of a departing founder is forfeited, it can be used to hire a replacement thus minimizing the dilution to the remaining founders. In addition, investors may wish to ensure that the founders are motivated to remain with the company to build its value. Restricted stock fulfills these objectives and is often used as a form of equity compensation for founders.

Unlike the grant of stock options, the grant of restricted stock is the issuance of shares of the company’s stock. A holder of restricted stock can vote the shares at stockholder meetings and has all of the other rights of a stockholder under applicable corporate law.

Restricted stock is generally subject to a repurchase right that allows the company to repurchase a portion of the founder’s stock if his or her employment is terminated by the company for cause, or if the founder voluntarily resigns within a certain period of time. This repurchase right lapses over time, freeing the stock of the restrictions in much the same way that stock options are subject to a vesting schedule.

The founder is subject to ordinary income tax as the restrictions lapse in an amount equal to difference between the purchase price of the shares and the fair market value of the stock at the time the repurchase restrictions lapse. However, the founder can file a "Section 83(b) Election" with the IRS within 30 days of the grant of the restricted stock to accelerate this tax to the grant date. If this election is made the founder is subject to ordinary income tax upon the grant of the restricted stock equal to the fair market value of the stock on the grant date. In either case, the founder is subject to capital gains tax when the stock is sold.

The two most common forms of equity compensation, stock options and restricted stock, serve similar, yet different, purposes in structuring a company’s compensation plan. Proper use of equity compensation is important in building a start-up company as it helps ensure the hiring, motivation, and retention of quality employees.

-Jeevan Padiyar

"So I have my first few venture capital pitches coming up.

I've got what I think is an engaging presentation with good visual aids.

What -- if anything -- should I give to people at the pitch before I present?

What -- if anything -- should I leave with them after I finish?

What will they be expecting?

Is there a standard way to do things?"

I saw this set of question on the funded. We get asked this all the time, so I figured it would be a great topic of discussion here.

What -- if anything -- should I give to people at the pitch before I present?

If you've made it past the telephone or in person screening, good work.  You should now spend your energy on making the experience as "easy" as possible for you potential investor. Don't assume that they will remember eveyrthing about your business, as they see multiple tens if not hundreds of plans a month. To keep your idea fresh in their mind, send an email a few days prior to the meeting with your 1 to 3 page executive summary and be sure to both thank the investor for the opportunity to speak in person, confirm the date and time of your meeting. This small step will go a long way towards showing them that you have your act together.

At the start of meeting itself, I wouldn't hand out anything but that same one to three page executive summary and your business card.  If you provide copies of your slides/ chances are your audience will be rifling through the pages during your presentation.

What -- if anything -- should I leave with them after I finish?

I would always leave copies of your presentation and executive summary along with your business card. However bring your long form businessplan and current financials/financial projections, in case some one asks for these items.

What will they be expecting?

This is best answered by this talk that David Rose gave at TED in March of 2007.

 

Is there a standard way to do things?

You will probably have 30 mins to an hour to present and answer questions. Be sure to keep your presentation short 10-15 slides at a minute per slide and leave the remaining time for indepth questions. Have slides ready for some of the more common questions and the end of your presentation, but only show them if those specific questions are asked. 

Be certain that your talk covers the following topics and start with your one line pitch so that people have an idea about what you will be discussing during you presentation:

1) Market Pain Point- The problem you are solving

2) Your solution - How you are solving it

3) Your business model - how you will make money

4) Potential customers- Who will buy your product and why they would care

5)Marketing and Sales Strategy - How you will get the word out and generate sales

6)Progress to date - What has been completed thus far.

7)Competition - Who is doing something similar

8)Competative advantage- What makes your product / solution better than the rest

9)Barriers to entry- What keeps your competition from eating your lunch.

10)Management Team and Board of Directors

11)Current Financials and Financial projections (includes money raised to date)

12)Capital Sought and uses of that capital

13)Potential Exit scenarios

 

Do you have any additional suggestions? If so please leave a comment below.

-Jeevan Padiyar

It is amazing how much of a connected thriving community of entreprenuers and service providers are located right here in our own backyard! Also, some food for thought, Mark Davis posted an interesting quick note about the top 5 places to find great talent in New York. See what he has to say here.

What do you think? Are these valid resources for finding quality talent in the NYC or do they leave much to be desired? Feel free to post your comments.

--JCA Justin