In the first half of this year, the level of venture-capital investment hit its highest quarterly mark since Q2 2001. Big M&A deals like WhatsApp, Oculus and Zillow have become prolific. And more and more companies are getting financing at eye-popping valuations.
For many startups, the hot venture-capital and exit markets mean an increase in deal leverage when negotiating with venture investors. (Editor’s note: Venture capitalists have noticed, and are trying to differentiate themselves.) As a result, founder-favorable terms are increasingly a part of formation and financing documents where they wouldn’t have been just a year or two ago.
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