MARK KOHLERMain Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, Main Street Professionals, LLC · Owner at Main Street Professionals, LLC

How to Prep a Deal In Case Things Go Wrong

17 Dec 2025 · 1 min

Watch on YouTube

0:36

Mark Kohler shows how to structure deals with built-in flexibility. Start with cash plus a small equity stake, then embed conversion clauses that let the deal shift based on performance: if things go well, convert to real ownership; if they struggle, convert to a different instrument. When the company raises capital later, those rights can escalate to preferred shares.

Chapters

We go back to that original deal and I say, okay, I want that 100 grand. And Matt says, okay, I'll do it. And I want 10% and two points and all that. And I go, okay, but if things go well, that's great. If they go bad, I'd like to convert it. I'd like to convert you into a partner. And Matt may say, okay, if they go well or bad, I may want to be a partner. So depending on negotiation, Matt may be able to pull the ripcord and go, hey, this is going better than I thought. I get to convert it to real ownership. Or if it goes worse, you might be able to convert it to this or that. And then you may say, if we go to raise capital, I can convert it even further. I can not only go from a partner, I could come to a and we're going to go to the next level. I get preferred shares or I get something even more special if we go big.