If you think of the ongoing relationship between you and a venture capital investor (VC) is a marriage, then you can think of the term sheet at the prenuptial agreement.
The term sheet is a document that outlines the terms by which an investor will make a financial investment in your company. Term sheets tend to consist of three sections:
The funding section details:
The corporate governance section includes:
The liquidation section details how investors will be able to get their money back out from the investment. It includes:
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