Corporate Finance & Securities

Key Term Sheet Provisions

Within the context of angel investing and venture capital financing, you will often hear the phrase “term sheet” thrown around. A term sheet typically includes the conditions under which an angel investor or venture capital firm will finance a startup company. The term sheet outlines the material terms of a business agreement, but it is not a substitute for a proper agreement. Instead, it records the intentions of the parties to the transaction that will become a part of a future agreement. The term sheet is one of the first and most important documents that will help to define the relationship between investor and entrepreneur. Important term sheet provisions include: liquidation preference, participation, drag along agreements, antidilution, conversion, and many more.

Today, we’re starting a blog series on key term sheet provisions. Every Friday we will discuss a new topic. Our first topic is price.

You might want to bookmark this post as it will be updated with hyperlinks as we continue to address new topics in this series.


Kyle Hulten

When I'm not in the office I enjoy cooking, gardening, and watching my toddler son explore his little universe.

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