Startup Engine Resources
Venture law, explained with numbers
Plain-English guides for founders and angel investors building Delaware C-Corps, from incorporation to Series A. Each guide starts with the short answer, shows current market data (Carta, Cooley and others, 2025-2026) and works through real numbers. Written and reviewed by BlackBox Startup Law. Last reviewed: October 2026.
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Formation and founders
Incorporating, issuing founder stock, vesting, 83(b) and IP: the foundation investors check first.
How to Incorporate a Delaware C-Corp for a Venture-Backed Startup (Step by Step)
The ten steps from name check to founder stock, with the charter settings that avoid franchise tax shocks and diligence problems later.
Post-Incorporation Checklist: Every Document a Startup Founder Needs
The documents and filings to finish in the first 30 days after the charter is filed, and the ones investors ask for at the first round.
Founder Vesting Explained: 4-Year Schedule, 1-Year Cliff and Acceleration
Reverse vesting, the cliff, monthly vesting and single versus double trigger acceleration, with a month-by-month example.
The 83(b) Election: Deadline, How to File (Including Online) and What If You Miss It
The 30-day rule, the IRS online filing option introduced in 2025, a tax comparison with and without the election, and non-US founder steps.
IP Assignment for Startups: Founders, Employees and Contractors (CIIAA / PIIA)
Who must assign IP to the company, the "hereby assigns" rule, what a CIIAA contains and how to fix gaps before diligence.
How to Split Founder Equity: Frameworks, Examples and Pitfalls
Equal versus weighted splits, a simple scoring framework with a worked example, and how vesting and decision rules prevent co-founder disputes.
Non-US Founders Forming a Delaware C-Corp: EIN, ITIN, Banking, BOI, Form 5472 and Home-Country Tax (Mexico and LatAm Example)
The extra steps for founders outside the US, from EIN by fax to Form 5472, plus how Mexican and Latin American tax rules interact with a Delaware parent.
SAFEs, notes and angel rounds
Pre-seed and seed instruments, how they convert and how much they dilute.
SAFE Explained: Post-Money vs Pre-Money, Valuation Cap, Discount, MFN and Pro Rata
How a SAFE converts, why the post-money cap fixes the investor's percentage, and what market caps and terms look like in 2025-2026.
SAFE Dilution Calculator Explained: How Stacked SAFEs Convert (With Examples)
A full worked example of three stacked SAFEs converting in a priced round, post-money versus pre-money, with every number shown.
Convertible Notes vs SAFEs: Which Should a Startup Use in 2026?
Interest, maturity, cap and discount side by side, a conversion example with accrued interest, and when a note still beats a SAFE.
Angel Investors: How to Review a SAFE or Term Sheet Before You Sign
The investor-side checklist: confirm the form, model your ownership after the next round, diligence the basics, and get the right side letters and tax records.
Term sheets and priced rounds
Every clause of a seed or Series A term sheet, with market data and worked examples.
How to Read a Seed Term Sheet: Every Clause and What Is Market in 2026
Each term sheet clause in plain English, with what is market, what is founder-friendly and what should worry you, plus a price per share example.
Liquidation Preference Explained: 1x Non-Participating vs Participating (With Waterfall Examples)
Who gets paid what at $8M, $15M, $30M and $100M exits under each type of preference, and why 1x non-participating is the 2026 standard.
Anti-Dilution Protection: Broad-Based Weighted Average vs Full Ratchet (With Examples)
The weighted average formula step by step, a down-round example comparing broad-based, narrow-based and full ratchet, and the carve-outs to insist on.
Startup Board of Directors at Pre-Seed, Seed and Series A: How Founders Keep Control
Typical board sizes by stage, the 2-1 and 2-2-1 structures, observer seats, the "current CEO" seat trap and how voting agreements lock it all in.
Protective Provisions and Investor Vetoes: What Founders Should Accept
The standard veto list, why all preferred should vote as one class, thresholds that hand a small investor a block, and which vetoes to refuse.
The Option Pool Shuffle: How Pool Size Changes Your Real Valuation (and How to Negotiate It)
Why a 20% post-money pool can cut a $10M pre-money to an effective $7M, and how to argue for a pool sized to your hiring plan.
Pro Rata Rights, Information Rights and Major Investor Thresholds Explained
The pro rata formula with an example, YC's pro rata side letter, where to set the major investor threshold and what financial reporting is market.
Drag-Along, Right of First Refusal (ROFR) and Co-Sale Rights Explained
How a drag-along forces a sale and which conditions protect common holders, plus how ROFR and co-sale apply when founders sell shares.
Series A Readiness: What Changes From Seed and How to Prepare
The Series A document set, the legal clean-up investors expect, a pro forma ownership example and a readiness checklist by area.
VC Due Diligence Data Room Checklist for Seed and Series A Startups
Ten folders and about 70 items investors' counsel asks for, how to organize them and the findings that delay closings.
Equity, tax and compliance
Options, QSBS, franchise tax, securities law, hiring and cap table hygiene.
Stock Options 101 for Startups: ISO vs NSO, 409A Valuations and Early Exercise
ISO versus NSO tax treatment with numbers, why every grant needs a 409A price, the 90-day window and when early exercise makes sense.
QSBS (Section 1202) After the July 2025 Changes: What Founders and Angels Must Know
The new 3, 4 and 5-year tiers, the $15M cap and $75M asset test, which stock still follows the old rules, and the traps for SAFEs, notes and options.
Delaware Franchise Tax: Why You Got a Huge Bill and How to Fix It
The two calculation methods with worked numbers, why a 10M-share startup usually owes $400, and how to file using the assumed par value method.
Securities Law for Startup Fundraising: Reg D 506(b) and 506(c), Form D, Reg S and Rule 701
Which exemption fits your round, what counts as general solicitation, how to verify accredited investors in 2026, Form D timing and Reg S for investors outside the US.
Startup Advisor Agreements and Advisor Equity: Market Ranges, Vesting and Key Terms
Market advisor grants by role and stage, a vesting example, options versus restricted stock, and the clauses every advisor agreement needs.
Hiring Your First Employees and Contractors: US and International Checklist for Startups
The documents and filings for a first hire, how to avoid misclassification, how to size the first option grants and the three ways to hire outside the US.
Cap Table Best Practices and Common Mistakes for Startups
What a clean cap table contains, issued versus fully diluted views, how to record SAFEs and options, and ten mistakes investors find in diligence.
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