An engaging guide to excelling in today's venture capital arena Beginning in 2005, Brad Feld and Jason Mendelson, managing directors at Foundry Group, wrote a long series of blog posts describing all the parts of a typical venture capital Term Sheet: a document which outlines key... read more
Title Page
Copyright
Dedication
Foreword
Preface
-- Audience, Overview of the Contents, Additional Materials
Acknowledgments
Introduction: The Art of the Term Sheet
Chapter 1: The Players
-- The Entrepreneur, The Venture Capitalist, The Angel Investor, The Syndicate, The Lawyer, The Mentor
Chapter 2: How to Raise Money
-- Do or Do Not; There Is No Try, Determine How Much You Are Raising, Fund-Raising Materials, Due Diligence Materials, Finding the Right VC, Finding a Lead VC, How VCs Decide to Invest, Closing the Deal
Chapter 3: Overview of the Term Sheet
-- The Key Concepts: Economics and Control
Chapter4: Economic Terms of the Term Sheet
-- Price, Liquidation Preference, Pay-to Play, Vesting, Employee Pool, Antidilution
Chapter 5: ControlTerms of the Term Sheet
-- Board of Directors, Protective Provisions, Drag-Along Agreement, Conversion
Chapter 6: Other Terms of the Term Sheet
-- Dividends, Redemption Rights, Conditions Precedent to Financing, Information Rights, Registration Rights, Right of First Refusal, Voting Rights, Restriction on Sales, Proprietary Information and Inventions Agreement, Co-Sale Agreement, Founders' Activities, Initial Public Offering Shares Purchase, No-Shop Agreement, Indemnification, Assignment
Chapter 7: The Capitalization Table
Chapter 8: How Venture Capital Funds Work
-- Overview of a Typical Structure, How Firms Raise Money, How Venture Capitalists Make Money, How Time Impacts Fund Activity, Reserves, Cash Flow, Cross-Fund Investing, Departing Partners, Fiduciary Duties, Implications for the Entrepreneur
Chapter 9: Negotiation Tactics
-- What Really Matters?, Preparing for the Negotiation, A Brief Introduction to Game Theory, Negotiating in the Game of Financings, Negotiating Styles and Approaches, Collaborative Negotiation versus Walk-Away Threats, Building Leverage and Getting to Yes, Things Not to Do, Great Lawyers versus Bad Lawyers versus No Lawyers, Can You Make a Bad Deal Better?
Chapter 10: Raising Money the Right Way
-- Don't Ask for a Nondisclosure Agreement, Don't Email Carpet Bomb VCs, No Often Means No, Don't Ask for a Referral If you Get a No, Don't Be a Solo Founder, Don't Overemphasize Patents
Chapter 11: Issues at Different Financing Stages
-- Seed Deals, Early Stage, Mid and Late Stages, Other Approaches to Early Stage Deals
Chapter 12: Leters of Intent -- The Other Term Sheet
-- Structure of a Deal, Asset Deal versus Stock Deal, Forms of Consideration, Assumption of Stock Options, Representations, Warranties, and Indemnification, Escrow, Confidentiality/Nondisclosure Agreement, Employee Matters, Conditions to Close, The No-Shop Clause, Fees, Fees and More Fees, Registration Rights, Shareholder Representatives
Chapter 13: Legal Things Every Entrepreneur Should Know
-- Intellectual Property, Employment Issues, State of Incorporation, Accredited Investors, Filing an 83(b) Election, Section 409A Valuations
Authors Note
Appendix A: Sample Term Sheet
Appendix B: Sample Letter of Intent
Glossary
About the Authors
Index
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