Preferred Equity
topic on 6 shows · 7 statements across 7 episodes
Innovators & Investors 
the Startup Ideas Podcast 
Invest Like the Best 
Capital Allocators 
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7 statements about Preferred Equity, every show
Hays: OpenAI's 17.5% return is a preferred equity hurdle, not debt
“The 17 and a half percent return looks like a red flag until you look at it closely. It's preferred equity hurdle, not a coupon on debt. This is the main thing that the hundreds of posts I saw are missing priority on returns before common shareholders.”
Lyon: Performing Companies Quickly Refinance Expensive 16% Preferred Equity Bridges
“When you're doing straight preferreds, oftentimes they just refinance us out. You are a bridge in the structure between six and eight times, If the company does it all well, they're very quickly going to eliminate 16% money.”
Preferred equity mechanics are core economic terms, not legal technicalities
“This balancing act of equity versus debt versus how that, that preferred is going to, you know, how, what the convertible mechanics are what the call options are, the redemption rights, mandatory, non-mandatory, all those seem like frustrating lawyer details. …”
Thayer Street Structures Most Investments as Preferred Equity
“Most of the securities that we're investing in are some form of preferred equity, so structured equity, senior preferred, convertible preferred, participating preferreds.”
Kushner: Affinity Partners Initially Focused Mostly on Preferred Equity Deals
“Initially, we were doing mostly preferred equity deals.”
Hamed: Preferred equity lets founders pay dividends without fixed debt maturities
“If you raise preferred equity, you know, what you get mostly is you don't have a term on the investment. You know, you don't owe the money back at any given time, but you can still maybe like accrue an eight percent dividend or a 12% dividend and meet them in …”
Friedberg: Many venture-backed startups are worth less than their preferred equity
“I do think that there's a significant number of these companies that if they were to be truly valued on first principles in private markets today, they'll get valued as at a value that's less than their preferred equity, which means that there's a difficult re…”