As I read Fred Wilson’s commentary on the Ideal First Round Term Sheet, I was thinking that it’d be nice if there was a “for dummies” type of introduction to the term sheet. A term sheet is the contract between the entrepreneur/company and the investors/VC. It’s full of jargon that a first-time entrepreneur, who is busy building a company, is probably not familiar with.
Wouldn’t you know it, Brad Feld (another VC) has already written a very informative series on Term Sheets. Here’s the entire series:
- Price
- Liquidation Preference
- Board of Directors
- Protective Provisions
- Drag Along
- Anti-Dilution
- Pay-to-Play
- Dividends
- Redemption Rights
- Conversion
- Conditions Precedent to Financing
- Vesting
- Information Rights
- Registration Rights
- Right of First Refusal
- Voting Rights
- Employee Pool
- Restriction on Sales
- Proprietary Information and Inventions Agreement
- Co-Sale Agreement
- Founders Activities
- Initial Public Offering Shares Purchase
- No Shop Agreement (also Unilateral or Serial Monogamy)
- Indemnification
- Assignment
Hi, I'm Greg. I'm a cofounder of Killer Aces Media. We publish community blogs like