Terms (was: Your terms)
Suggested topics & further reading:
How much is your company worth? If you’re raising an equity investment, this is a relevant question. You need to know how much ownership you are willing to give to investors in return for their investment.
Be careful not to give away too much equity at an early stage of your business as this could limit your potential for raising future investments and could hinder your further growth. VCs generally love to see that the founders still have a significant stake in the company.
- Startup Valuation made simple by Serious Funding: The VC Method
- Equidam – Online business valuation
- The Secret Sauce to Startup Valuation
- What is a fair valuation for your startup? – “The #1 Guide To Startup Valuation”
Do you know this investor’s typical terms? Have you considered the concepts underlying a term sheet they could offer?
Have you researched how they carry out their due diligence and how long that process usually takes?
Take initiative in the process of drafting the term sheet; it could improve the deal you get!
Have you checked for killer terms? Are you taking on too much risk for your company?
- How does liquidation preference work? by Joachim Blazer
- How does anti-dilution work? by Joachim Blazer