The angel investing knowledge base

No method prices a pre-revenue company. The price is negotiated, and the methods keep that negotiation honest. What sets an early-stage valuation in practice, and how to test a proposed pre-money figure before agreeing to it.

Everything an angel signs in Norway sits on the Companies Act, and the most useful thing to know is what it does not give a minority shareholder. The ownership thresholds, the mechanics of a share issue, the transfer rules and the board’s duties, each with its section number.

Buying existing shares and subscribing for new ones look like one transaction and are two legal regimes. A purchase is a sale with a seller to claim against; a subscription in a share issue is a corporate act with no statutory buyer remedies at all, so the protection is whatever was contracted.

Norwegian company law gives a minority shareholder almost nothing: no tag-along, no drag-along, no board seat, no entitlement to a dividend. Every clause in a Norwegian shareholders’ agreement repairs a specific gap in that statute. Each clause group, the statutory default it replaces, and what an incoming minority investor should negotiate.

The term sheet fixes the economics and the control of a deal before the lawyers begin, and everything conceded there is conceded again in the definitive documents. Each clause in turn: what it does, what European and Norwegian practice treats as standard, and where to hold the line.