Any entrepreneur who is serious about his trade will need to know about the term sheet.
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“A term sheet is like a prenuptial agreement and a coach’s playbook. Spend the time to understand the plays, and what happens should you ever separate from the business.”- Mitch Thrower
Angel and venture capital investors may receive hundreds or even thousands of executive summaries each year. With their time being limited and the competition for their attention intense, it is extremely important that the entrepreneur provide executive summaries that “Wow!”
The capitalization table (cap table) summarizes who owns what part of the company before and after financing. It is one of the most important elements of the term sheet because it outlines the complete transaction succinctly using concrete numbers.
Startup due diligence is one of the most important components of the funding process for a new business…
As Angels and VCs are tightening their fists, entrepreneurs are less likely to get next stage funding. Having a great team, pitch and front man are simply not enough.
As an angel investor and leader of an angel group, I receive funding inquiries every day. Most come in the form of an executive summary, which typically provides one of the initial interactions an entrepreneur will have with an investor.
A fair number of really smart, well-prepared entrepreneurs get tripped up, stumble around and eventually fall to the ground when they make their startup funding pitches to the Angel Investment Group that I am a part of.
The Billion Dollar Startup Club has 101 companies as of July 2015, with the number one private company valued at $46 billion. It’s no secret, technology has revolutionized entrepreneurship. The explosive growth of tech-based companies is at its highest since 1995, surpassing the dot-com boom of year 2000.
The entrepreneur seeking investment from major corporations with investment arms should recognize there are many advantages to seeking and obtaining such investment. However, such investment should be sought with the entrepreneurs’ having a strong understanding of their startups objectives and opportunities, and the strategy and fit with the potential corporate partner.