Startup Term Sheet Explained: Key Clauses to Understand Before You Sign
Key Takeaways A term sheet outlines a financing: the money, governance and investor rights that the full legal documents will later set out. Founder ownership depends on the valuation, the option pool and converting SAFEs or notes, not only on the cheque size. Preference and participation terms dec
Read more
SAFE vs Convertible Note: How Founders Choose Between the Two
Key Takeaways Under the standard Y Combinator form, a SAFE is a right to receive shares later; it carries no interest and has no date by which it must be repaid. A convertible note starts life as a loan, so interest, a maturity date and the investor's position as a creditor all become part of the c
Read more
Pre-Money vs Post-Money Valuation Explained: Formulas, Examples and Dilution
Key Takeaways The pre-money figure prices the company as it stands before a round; the post-money figure adds the fresh capital on top. When a round is a plain priced equity deal, an investor's stake is the cheque size divided by the post-money number. A higher headline valuation does not automatic
Read more