Rounds & fundraising
What is Term Sheet?
A non-binding summary of the key economic and control terms of a proposed investment - preceding the formal definitive documents.
A term sheet outlines the major terms of a proposed financing: valuation, investment amount, liquidation preference, option pool requirement, anti-dilution mechanics, board composition, protective provisions, vesting refresh, and key drag/tag/ROFR rights. It's non-binding (except for exclusivity and confidentiality), but signing one effectively commits the parties to negotiate in good faith on the terms outlined. Definitive documents (Stock Purchase Agreement, IRA, Voting Agreement, ROFR) follow once the term sheet is signed.