This should be coming out of the investors' management fee (the 2% of the "2 and 20") but by making "the company" pay they shift the cost onto their LPs.
The best you can do is limit the legal fees in the TS.
Bingo. This is an important detail that's easy to miss; but a VC has a huge incentive to lower its own costs while increasing capital committed. Any expenses come straight from the GPs' pockets. Capital invested is paid for by LPs and the VC even earns management fees on it.
It'd be in a VC's best interest to invest $60k more for the same equity, and make the startup pay that expense, vs. paying for it directly. It's a win-win for startups and VCs. LPs get a bit screwed, however.
It'd be in a VC's best interest to invest $60k more for the same equity, and make the startup pay that expense, vs. paying for it directly. It's a win-win for startups and VCs. LPs get a bit screwed, however.