I had a former employer call once and ask me to sign a form confirming that I had opted not to exercise the stock options worth 0.125% of the company when I left.
They were raising a new round and my old grant was a sticking point because the new investors weren't content with the company not having a record of my exercise.
I signed because it helped them out, cost me nothing and seemed like the right thing to do. Just think it was funny that a VC was so averse to dead equity that they made the company make sure someone who wasn't on the cap table agreed that they weren't on the cap table.
Not if they are actively participating. They might have a seat. They might vote on deals. They might actually help.
Dead equity does none of the these things. Think of it as spent or no longer in play.
I don't know why some people are so touchy about the term. It's not a value judgment on the contributor. Furthermore, I would argue that a lot of the time Angel investment or friends and family investment is dead Equity too
How could you say that? VCs are there to go to bat for you, make connections that change the trajectory of your business, and support you however they can. /s
Equity owned by former employees or anyone not still involved in building the company. Awesome derogatory term for people who got paid fair and square.
