Ryan Breslow, CEO and founder of Bolt Financial, has offered employees loans to buy their vested stock options. The idea is to allow them to start the countdown to when they no longer have to pay capital gains taxes on their shares. However, the plan could backfire. More: - The problem is the following:
- Assuming that Bolt eventually exits for a higher share price than the employees pay for their vested stock, then everything is hunky-dory.
- However, there is a chance that it will be valued below the $14B it commands today and possibly even below the discounted rate employees pay for the stock.
- In this case, those employees would owe Bolt more money to pay the loans than they receive from their payout. Worse, the loans could come from a creditor, which would have little sympathy for the hard-up workers.
- As Axios reports, this practice emerged in the dot-com boom. Given how that bubble turned out, it caused many problems.
- One source noted that the idea is usually shot down by more experienced board members, who have to rein in the goodwill of the founder. Check out this article for an explanation of why the idea is so tricky.
- Dan Primack suggests several alternatives to the loans, which avoid the pitfalls of debt though they don't eliminate the issues of the capital gains tax:
- Companies can offer cash bonuses, RSUs, or straight stock grants, and an extension of the option exercise window out by 10 years.
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Spotter, a YouTube channel scaling platform, raised $200M Series D led by SoftBank at a $1.7B valuation. Prior to this, Spotter had raised $555M across three undisclosed rounds. Previous backers include Access Industries, HighPost Capital, CoVenture, GPS Partners, and Crossbeam Venture Partners. More: - Spotter aims to solve a problem facing YouTubers who rely largely on ad revenue for their livelihoods.
- Ad revenue grows in proportion to a YouTuber’s back catalog, accumulating hits and consequently ad dollars.
- However, it takes a while for this to kick in, meaning that creators lack the capital to scale early in their careers.
- Spotter provides scaling capital upfront in exchange for the right to a slice of future ad revenue.
- It has so far done 200 deals of this type and claims to be on track to reach $1B invested in creators by mid-2023.
- That would come four years post-founding. In 2022 alone, the company hopes to spend $500M to license creators’ back catalogs. Its average deal size is $1.5M, though some with smaller channels can be as low as $15,000.
- Spotter founder and CEO Aaron DeBevoise notes that creators will frequently do two or three deals with the company.
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New SEC rules requiring more disclosures from large private companies would have a radical impact on unicorns. The SEC’s new rules would push companies to go public as the reporting advantages of staying private would dwindle away. More: - However, some argue that more stringent reporting requirements for public companies could turn private companies off from seeking a Wall Street exit.
- As Crunchbase reports, most unicorns are currently protected from disclosure rules, which apply to companies with more than 2,000 investors.
- There is an exception for investors that act in a cohort of one vehicle. This can substantially reduce the investor count. Whether the SEC specifically targets this provision is still unknown.
- Generally, the reports of how exactly private companies will be affected are vague. Still, sources largely agree that they will mirror the SEC’s proposed alterations to reporting requirements for larger funds.
- Those broad new disclosure rules for private funds will require them for the first time to provide quarterly statements detailing fund performance, fees, and expenses, as well as manager compensation.
- They will also be required to undergo annual audits and to report both advisor-led secondary transactions as well as any preferential treatment for LPs.
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Finnish supply chain automation and optimization platform Relex Solutions has secured $570M (€500M) led by Blackstone Growth. The company’s valuation grew to $5.7B. More: - Founded in 2005, the company had raised almost $230M prior to today’s round.
- It employs 1,300 people and saw its customer base expand to over 350 top brands, including Dollar Tree, M&S Food, Flink, Morrisons, PetSmart, Sephora, and Rossmann.
- Relex’s platform uses AI to expedite shipping processes at every segment of supply chains with the intent of reducing waste.
- It further claims that this increased efficiency can allow retailers to eliminate food waste without impacting customer experiences.
- Retail food waste accounts for 13% globally.
The wider lens: - Investors have pumped $7B into the supply chain technology sector since 2018, according to data from analytics firm GlobalData.
- Of that, $2.46B was funneled into the sector in the past two years. That figure is down from the peak of 2019 when 240 deals injected $2.99B into the sector.
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 Today's Funding 💸 Biotech/Health - Electra Therapeutics (San Francisco, Calif.), treatments for immunological diseases and cancer: $84M B led by Westlake Village BioPartners, OrbiMed, participation from Redmile Group, Cormorant Asset Management, et al.
- Memo Therapeutics (Schlieren, Switzerland), antibody discovery and development: $25M B from Swisscanto Invest, Adjuvant Capital, Fresenius Medical Care Ventures, GF Group, Verve Ventures, Vesalius Biocapital, Zürcher Kantonalbank.
- Dutch (San Francisco, Calif.), virtual veterinarian care platform:...
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 |  | Inside VC's writer/curator Stephen currently lives in Berlin and is pursuing a Master's degree in philosophy. He otherwise spends his time trying his hand at recipes from India and Southeast Asia, escaping it all at the kickboxing gym, and offending aural sensibilities with his band. |  | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 Ford. | |
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