In an effort to remove some unnecessary friction from early stage financings, a number of organizations have recently provided (on an “open source” basis) various legal forms for use in financings. Among the earliest publicly available forms were the documents produced by the National Venture Capital Association via a coalition of law firms and venture capital firms. Those forms are generally designed for Series A financings, not early stage seed financings. Later, we saw the release of the Series Seed forms, Y Combinator’s SAFE forms and Series AA forms. And, most recently, 500 Startups released their version of convertible note and convertible equity documents they call KISS. As a side note, the naming conventions for these securities are getting very creative!
At Cooley, we work regularly with all of these forms and others. We also have thoughts and opinions about the use of these forms, and how they may apply to particular deals. We think it helps entrepreneurs to have a central location where they can generate these forms using our Cooley GO Docs, which is our mobile friendly, automatic document generation software.
We were not involved in the preparation of these forms and are not necessarily endorsing any form, or the use of those forms either generally or in any specific instance, since all have their pros and cons, and are just one organization’s opinion of what is, or what should be, a “market” standard document.
This is our small contribution to help make these various forms more accessible and easier to work with. We recommend that you get advice from a lawyer to help you understand the meaning of the documents, how they may impact you, which forms are appropriate for your company, etc. But if you know what you want to do, we think you and your attorney should have a simple way of generating the documents.
Today, we are releasing the 500 Startups KISS forms. These forms were just released last Thursday, so we have iterated pretty quickly on them (who says law firms can’t be nimble). We have other forms in development right now and will release those soon, and we’ll continue to provide forms and other documents as our clients continue to provide us with feedback about the library of documents available on Cooley GO, and what additional documents they would find useful.
And as usual, we welcome any feedback from our readers on this service (you can click the call-out box on the right of the screen or mobile users contact us via email).