T-Mobile’s New Terms &a...

Anyone who’s ever taken a stab at reading through a Terms & Conditions agreement knows that they normally rival the Iliad in length. There are two reasons companies do this: first, the more words, the more coverage and protection that company gets within its T&C, and second, the less likely you are to actually read it and find out that you’ve agreed to sell your first born child as payment for this or that product. Or worse, your warranty ends after the first month. Since no one but lawyers ever enjoys reading these lengthy contracts, we’ve taken it upon ourselves to figure out what’s new in T-Mobile ’s Terms & Conditions, which were updated July 24 . In truth, not much has changed. However, a new clause regarding changing plans has found its way into the contract. Section Five now reads: “Changes to Your Service: You may be unable to change your Rate Plan, including services and features associated with your Rate Plan. You may request to change to another Rate Plan during your Term, and if we authorize the change, you may be charged a migration fee of up to $200 for each line of service, and you may continue to be bound to your existing Term or an extended Term. The amount of the migration fee will decrease as the time remaining on your Term decreases. For specific information about changing your Rate Plan, including migration fee details, call T-Mobile.” This updated version of the T&C was released alongside a new set of cheaper smartphone plans from T-Mobile called “Value” plans . This new clause is meant to transition people from the old to the new plans. If you’re interested in switching from a Classic plan to a Value plan, here are some things to think about: The reason the Classic plan is more expensive is because it includes subsidies for new phones, and discounts when you’re eligible for an upgrade. With a Value plan, you’re required to pay the full price of the phone when purchased from T-Mobile, whether that be in one lump sum, or with a down-payment followed by monthly installments. That bit in the T&C about “if we authorize the change” may sound a bit overbearing but T-Mo is actually just looking out for you. If you happen to be a repeat upgrader, than the lower monthly bills from Value plans may not be very helpful. The saved cash will likely have to go towards your next smartphone, since opting out of the Classic plans excludes you from any subsidies or upgrade discounts. By adding this to the T&C, T-Mobile is making sure that both parties are aware of the consequences that a plan switch-up might bring along. On the other hand, if you own a travel phone or a secondary phone that you don’t plan on upgrading/replacing any time soon, a switch over to a Value plan may be your best choice. You’ll just have to eat that $200 migration fee.

One Book Every Entrepre...

Editor’s Note:  This is a guest post by Mark Suster ( @msuster ), a 2x entrepreneur, now VC at  GRP Partners . Read more about Suster at his  Startup Blog ,  BothSidesoftheTable. tl;dr version: If you’re an entrepreneur or VC or will be working in this industry -  buy this . read it. live it. When I first started as a startup CEO in 1999 there were no guides on raising venture capital. There were no explanations for all of the confusing details outlined in a term sheet. Drag along rights? Um, OK. That sounds fine to me. I barely understood it. I asked my lawyer for an explanation. He gave me the human explanation for what the term meant. It sounded logical enough, so I moved on to the next point. Only later did I learn how it could be used to screw me. Redemption rights? Sounds harmless enough. But know that every term in your term sheet is there as a result of some dispute of the past between shareholders or between shareholders & management.  Founders don’t often think about “primary” stock vs, “fully diluted” stock in terms of voting rights. I never did. VCs always know the voting thresholds and no number in your term sheet is there by accident. To this day I’m still surprised how few CEOs really understand the differences between 2x liquidation preference and a liquidation preference with a 2x cap. Or what “participating preferred” stock is and how it can screw you. Or what “flat spots” on a cap table are. If you want to see a quick summary of some terms & a video that walks you through how VCs view a cap table my colleague Kelly Hwang & I produced a quick tutorial here : In fact, some of the biggest surprises I learned about term sheets were: 1) how the language never says anything remotely like “blocking rights” for terms that VCs want to use to block certain actions of your company. Liquidation preferences never say things like “participating preferred” although we all talk about it. It’s hidden in legal language. Blocking rights and liquidation preferences exist for rational reasons and when used properly are fair. Used egregiously and you’ll have problems later. You need to understand them. 2) how seldom lawyers walk you through the “how can this term be used against you” scenarios or the “pragmatic guide to VC terms” overview. They are helpful, certainly, but often if you don’t know the right questions to ask you’ll be left unawares. 3) VCs are anal about things like voting thresholds, seniority of their stock, protective provisions, etc. – entrepreneurs never seem to focus on anything other than ownership percentage. It’s no surprise that I got a bit fawked on my first company. There was no guide. No book. VCs were negotiating with asymmetric information . Brad & Jason’s, Venture Deals , aims to change this. I was significantly wiser by 2005 when I started my second company. Even so, I found myself reading Feld.com every day. I think that’s around the time when Brad & Jason did their famous “term sheet series,” which was the authoritative guide I never had the first time. I read every post several times. This series inspired me to start my blog as a VC. I also decided never to spend much time on term sheets on my blog because they had already covered it far better than I thought I ever could ( Jason was a lawyer with Cooley Godward, one of the top VC law firms, after all). From there VentureHacks was then launched which gave entrepreneur advice on fund raising from your point of view. It is also a must read. Now Brad & Jason have raised the bar. They’ve written this comprehensive book called Venture Deals that should be read by anybody dealing with funding of startups – whether you’re a startup CEO, CFO or other founder or whether you work in the ecosystem (lawyer, debt provider, banker, VC). It goes far beyond any other book I’ve seen on the topic in helping you understand the key terms, plan the negotiation and understand the motives of the various actors at the table. It’s a gem. I think the industry works better when all sides are informed. The fact that Brad so routinely puts out information like this is what earned him the number one spot on this list of VCs that entrepreneurs most respect . And while Jason is less high profile as the ever-present Brad Feld, I think even Brad would acknowledge that when it comes to the knowledge supplied in a book like this, Jason is the man with the deep knowledge. Let’s get rid of the information asymmetry problem. Every startup needs the knowledge in this book.

Apple Strikes Back in A...

Shockingly enough, Apple isn’t down with Amazon’s claim that the term “app store” is generic, and recently denied such a claim during the ongoing tiff between the two application providers. Amazon argues that the term “app store” is generic, and when the words are put together, they signify a store where one can buy and download applications. Read more…

Facebook Has Already Tr...

I was aware that Facebook is close to trademarking the term ‘face’ , at least in relation to online social networking and related activities, in the United States. But as far as I know, nobody has yet pointed out that Facebook has already pulled that stunt in the EU, i.e. the union of 27 European member states (which include the UK, Germany, France and Spain). Mark Brooks , an authority in the online dating industry, was kind enough to point me to the filing (screenshot below), which – surprisingly – dates back to May 2004, when Facebook was still in its very early days. As you can tell from the screenshot, the EU-wide trademark (in relation to usage of the word in the operation of online chat rooms, we should point out) was granted in October 2006, with the expiration date set to May 24, 2014. Again, I’m not entirely sure this hasn’t yet been reported, but I couldn’t find any coverage of it after some sleuthing, so figured I should report it here if only for posterity’s sake. It gets more interesting, though. Like in the United States, Facebook is also pursuing a trademark for the term ‘book’ in the European Union, notably in relation to online communities, social networking and Internet dating services. This filing was made more recently, in early November 2010. The application is still under examination by the OHIM, the trademark and designs registry for the internal market of the European Union. Evidently, we’ll be keeping an eye on it. Obviously, this move is likely to raise further questions over the company’s motives. TechCrunch readers will be aware that the social networking giant has already waged wars against sites using the word ‘book’ in their names (see the Lamebook and Teachbook cases). Facebook has also pushed travel site PlaceBook to alter its name to TripTrace. I’ve asked Facebook for comment and will update when I hear back. CrunchBase Information Facebook Information provided by CrunchBase

Google Quietly Updates ...

Google's latest Keyword Tool update improves the accuracy of exact match searches, and should make things easier for SEMs in the long term. ..