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How to negotiate a term sheet
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How to negotiate a term sheet

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How to negotiate a term sheet. An event organized by Startupbootcamp, presented by Patrick de Zeeuw (Startupbootcamp) and Dave Dirks (Certa Legal).

How to negotiate a term sheet. An event organized by Startupbootcamp, presented by Patrick de Zeeuw (Startupbootcamp) and Dave Dirks (Certa Legal).

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    How to negotiate a term sheet How to negotiate a term sheet Presentation Transcript

    • About MeCo Founder Startupbootcamp GlobalAuthor I’m Hungry, 100 basics to startup & accelerate a company
    • Global Startup Ecosystem
    • 70 teams accelerated since 2010
    • What’s a program like?3 months Acceleration | 3 months Funding18 months Alumni Growth Program
    • “SBC is NOT an incubator, its a well-oiled, full of gas,speed racing car, taking you from 0 to 200 km/h,not in 3 months, but in just a week.”
    • “SBC has a very large network of experts,mentors and investors who are more than willingto help in any way they can.”
    • Why we do this?Giving back | Create & activate startup ecosystems
    • pdz@startupbootcamp.org Patrickdezeeuw@patrickdezeeuw | @imhungry100+31 681429654 #SBCAmsterdamQuestions?
    • Dave DirksManaging Partner Certa LegalM&A & VC lawyerCo-Founder NTSU Fund I B.V.Shareholder StartupbootcampAdvisory board member / mentor@dave_dirks dirks@certalegal.nlTSF Tech Startups Funding
    • The Players
    • The Players• The Entrepreneur• The Venture Capitalist• The Angel Investor• The Syndicate• The Lawyer• The Mentor(Brad Feld, Jason Mendelson, Venture Deals, Be smarter than your lawyer and Venture Capitalist)
    • How to raise money
    • How to raise moneyDo or do not, don’t tryDetermine how much you are raisingFund-raising materialsFind your right investor(s)Closing the dealUnderstand it is about: Economics, ControlFinancing rounds: seed, series a, series b, etc.
    • Economics (I)Price– Valuation• Premoney / postmoney• Fully diluted• (Warrants)Liquidation preference– From 1x to 10x to 1x– Investor participation (full, capped, none)– Liquidation event definitionPay to play, pay or dilute
    • Economics (II)VestingIndustry standard:– 4 years (1 year + 36 months); 1 year cliffSingle trigger vs. double triggeraccelerationEmployee poolAnti – dilution:– (full ratchet, broad-based, narrow-based weightedaverage) (carve-outs)Good / bad leaver
    • Board of Directors– Official member– ObserverProtective provisions– Veto rights / Qualified majority, for major board andshareholders decisions (list or annex)Drag along (investor / founders & investor jointly)Conversion (liq pref / control)Control
    • Other