%0 Journal Article %A Adrian Horotan %T Convertible Debt with Discount Sacrifices the Upside
for Early-Stage Investors %D 2012 %R 10.3905/jpe.2012.15.2.025 %J The Journal of Private Equity %P 25-27 %V 15 %N 2 %X Unless the discount rate is much higher than what is considered fair, investing in convertible debt with a discount to the next financing round—without warrants, founders stock, or a conversion price cap—is equivalent to sacrificing most of the upside potential for early stage investors.TOPICS: Private equity, portfolio construction, fixed income and structured finance, portfolio theory %U https://jpe.pm-research.com/content/iijpriveq/15/2/25.full.pdf