Why Is The DFPI Requesting Funding To Implement Venture Capital Funding Reporting Mandate?

Last year, the California legislature enacted a bill, SB 54 (Skinner), that requires a "a venture capital" company to report annually to the Civil Rights Department on its funding determinations related to companies primarily founded by diverse...

Governor Seeks $1.63 Million To Implement Venture Capital Company Reporting Law That He Branded As "Problematic"

Article 14, Section 12 of the California Constitution requires the Governor to submit a budget to the Legislature by January 10 of each year. The Constitution further required that the budget be accompanied by a budget bill, which the chairperson of...

With California's Share Of Venture Capital Investment Falling, California Decides Its A Good Idea To "Bite The Hand That Feeds It"

According to this article by Carta, nearly 40.7% of all venture capital raised on its platform in the first quarter of this year went to companies headquartered in California. This sounds impressive, but it represents a precipitous decline from 2018...

California's Inept Attempt To Define Who Is A "Founding Team Member"

Last week, I reported that Governor Newsom had signed SB 54 (Skinner) even while acknowledging in his signing message that it contained "problematic provisions". SB 54 requires "venture capital companies", as defined, to disclose specific...

Despite Admittedly "Problematic Provisions" Governor Newsom Signs Venture Capital Disclosure Bill

Venture capital investment has been instrumental in the creation of numerous high tech businesses that have quite literally changed the world. There is no gainsaying the importance of venture capital firms to California. Therefore, one might expect...

Are Diversity Riders Legal?

Some venture capital firms have recently begun including so-called "diversity riders" in their term sheets. In general, these require that the issuer and the lead investor make commercially reasonable efforts to include a member of an...

Why Some Delaware Corporations May Be Concerned With California's Supermajority Vote Requirements

Section 710(b) of the California Corporations Code defines a "supermajority vote" as a requirement set forth in a corporation's articles of incorporation (or certificate of determination) that specified actions be approved by a larger proportion of...

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