I’ve invested in ~20 start-ups not originally based in the U.S.
I’ve found that their “cap tables”, the way they are initially financed are … all over the place. And generally, materially different from U.S. and especially SF Bay Area start-ups. And often have “gotchas” in side letters and financing documents that you just don’t see in standard U.S. start-ups (e.g., an almost infinite right to invest at a fixed, low price is not that uncommon).
I don’t care, in that it doesn’t stop me from wanting to invest.
I do in the term sheet restructure companies with truly problematic cap tables, indirectly or directly.
I do this mainly to make sure the founders have the proper amount of equity, and sometimes, to make sure the terms for the pre-existing investors are fair to the founders and conform to U.S. norms. So does YCombinator and others that successful invest in similar scenarios.
This always is better for the founders, and just as importantly, ensures the company can raise additional capital if it wants in an effective and efficient manner.
Put differently, I’ll help “clean up the mess” at this stage if there is one.