Hosted by Jay Adelson.
Entrepreneur, CEO, and business owner Jay Adelson (Equinix, Digg, Revision3, SimpleGeo) demystifies the start-up process by providing advice, tips, and answering questions. Ask Jay how to turn any business idea into reality: firstname.lastname@example.org, @jayadelson, or http://youtube.com/askjayadelson Read More
Successful entrepreneur and CEO, Jay Adelson, demystifies the start-up process by providing advice, tips, and answering questions. Today he discusses the central points that should be included in an initial term sheet.
Jay's Chalkboard Notes:
1. A term sheet is an agreement between you and an investor
2. A series of terms you think matter
3. Describes value of the business
4. Includes how much $$ you are getting and what % that translates into
5. Download simple templates at Seed Capital term sheets at SeriesSeed.com
6. There are not a lot of rules when it comes to term sheets
7. In essence, it's a suggestion of $$ and rights to stock
8. When in A & B rounds, term sheets include who is going to be on the board, and whether or not you are the CEO
9. A term sheet is non-binding
10. It's not official until later when everything is finalized
11. Term sheets are currency
12. Once you have one you can compare multiple investors
13. A term sheet gives you leverage
Your takeaway assignment based on today's question is to price out and find a good corporate attorney. Get recommendations, and spend $$ on someone who knows their stuff. They will help you negotiate. Be sure to sign a retainer.
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