Jason Calacanis talks with Becki DeGraw, partner at Wilson Sonsini, about the legal and strategic nuances of corporate spinouts. They discuss why spinouts fail, how to structure the cap table (including Jason's 80/20 rule), IP licensing pitfalls, fiduciary duty traps for founders still on the old board, and why a spinout should be treated like an amicable divorce. Becki provides actionable advice on getting the paperwork done before starting the new venture.
This summary was generated from show notes and public descriptions, not from a full transcript review. Details may contain inaccuracies.
Novel
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The 80/20 Rule for Spinout Cap Tables00:05:03
Jason's rule is that the new spinout should own 80% and the old parent 20%, because if the old company keeps too much equity, future investors will balk.
IP Licensing as an Alternative to Assignment in Spinouts00:08:44
Instead of assigning IP outright, spinouts often get an exclusive license from the parent, with a license-back to allow the parent to continue using the technology for its own purposes.
Fiduciary Duty and Confidentiality Traps in Spinouts00:13:23
Founders still on the old company's board can inadvertently breach fiduciary duties by taking customer lists or strategic information to the new venture.