Term sheet

Abstract: Have the negotiating edge when getting your new business off the ground Written by Dermot Berkery, an internationally known venture capitalist with Delta Partners, this complete toolbook thoroughly details how venture capitalists arrange the financing for a company; what they look for in a business plan; how they value a business; and how they structure the terms of an agreement. Within its pages, you'll find everything you need to successfully raise new business capital with the most attractive terms possible. Using informative case studies, detailed charts, and term sheet exercises, Raising Venture Capital for the Serious Entrepreneur discusses the basic principles of the venture capital method, strategies for raising capital, methods of valuing the early-stage venture, and proven techniques for negotiating the deal. The author leads you step-by-step through: Developing a Financing Map Getting to the First Stepping Stone Understanding the Unique Cash Flow and Risk Dynamics of Early Stage Ventures Determining the Amount of Capital to Raise and What to Spend It on Learning How Venture Capital Firms Think Creating a Winning Business Plan Funding Early-Stage Companies Agreeing on a Term Sheet with a Venture Capitalist Setting Terms for Splitting the Rewards Allocating Control between Founders/Management and Investors Aligning the Interests of Founders/Management and Investors This invaluable guide also includes term sheet exercises that test your understanding of various financing situations facing companies. In addition, the book features three extensive case studies: the first covering a fictional start-up company used throughout the book, the second offering a stepping stone map, and the third presenting a term sheet used in practice by venture capitalists.

Abstract: Preface. Acknowledgments. Chapter 1: Introduction. Chapter 2: The Players. The Buyer. The Seller. Investors/Owners. Corporate Staff. Advisors. Regulators. Others. Chapter 3: Decision to Buy or Sell. Reasons to Buy. Choosing to Sell. Chapter 4: Buyer's Preparation for the Deal. Developing a Strategy. Building a Capability. Devising a Process. Planning the Message. Chapter 5: Seller's Preparation for the Deal. Building a Capability. Making the Business Most Sellable: Cleaning It Up. Setting Expectations with Constituents. Chapter 6: Deal Process. Determining the Universe of Buyers. Making the Approach. One--on--One Negotiation. Formal Auction. Informal Auction. Bankruptcy Auction. Direct versus Proxy. Relative Positions of Power. Chapter 7: Due Diligence. Building a Team. What the Buyer Wants to Know. Chapter 8: Valuation. Standard Valuation Methods. Pro Forma: Finding and Splitting the Upside. Getting the Valuation and Pro Forma Done. Chapter 9: Integration Planning. Dedicating Resources. Linking Due Diligence to Integration Planning and Execution. Key Integration Issues. Chapter 10: Financing Issues. Cost of Capital. Lost Opportunities. Financing Contingency: "Bird in the Hand". Chapter 11: Closing the Deal and After. How Is a Deal Closed? Other Signing and Closing Events. Postclosing Issues. Integration and Look Back (the Postmortem). Appendix A: Standard Form Deliverables During a Strategic Transaction Example. Appendix B: Due Diligence Report Table of Contents. Appendix C: Standard Deal Process Checklist Example. Appendix D: Standard Approval Process Example. Appendix E: Approval of a Strategic Transaction: Key Topics in Presentation. Appendix F: Generic Valuation Exercise. Appendix G: Generic Acquisition Term Sheet for Acquisition by Public Buyer of Privately Held Target. Appendix H: Generic Investment Term Sheet. Index.

Abstract: Introduction. PART I: DOING YOUR HOMEWORK: PREPARING FOR THE VENTURE CAPITALISTS. The Venture Capital Revolution. Venture Capital FAQ: Is the Game Right for You? The Market Risk. The People Risk--Part I: Management Teams and Boards. The People Risk--Part II: Strategic Alliances. The Master of the Keiretsu: An Interview with Pete Musser. The Technology Risk. The Money Risk. PART II: GETTING FUNDED. How to Value Your Company. Writing Effective Business Plans. Which Venture Capitalist Is Right For You? Show Time: Presenting to the Venture Capitalists. Negotiating the Term Sheet: The Art of the Deal. Surviving the Due Diligence Process. Epilogue: Life After the Deal. Appendix A: Directory of Interviewees. Appendix B: Sample Confidentiality Agreement. Appendix C: Sample Term Sheet. Appendix D: TL Ventures Due Diligence Checklist. Appendix E: Preferred Stock Purchase Agreement. Appendix F: Select Online Entrepreneurial Resources. Appendix G: VC Resources for Women and Minorities. Notes. Index.

Abstract: Preface. PART I: THE BUSINESS OF VENTURE CAPITAL. 1. Entrepreneurs and Venture Capitalists. 2. Other People's Money. 3. The Limited Partnership. 4. The Competitive Environment. 5. The VC's Investment Model. PART II: ACCESSING VENTURE CAPITAL. 6. Introduction to Part II. 7. Is Venture Capital the Right Option?. 8. Choosing a VC Firm. 9. The Entry Point. 10. The Investment Process. 11. Preparing for the Investment Process. PART III: THE VC TERM SHEET. 12 Introduction to Term Sheets. 13. Business Valuation. 14. Investment Structure. 15. Syndication. 16 Investment Milestones. 17 Corporate Governance. 18. The Equity Participation. 19 Share Incentives. 20. Share Vesting. 21. Pre-emption Rights on Securities Issues. 22. Anti-dilution Rights. 23. Provisions Relating to Share Transfers. 24. Deal Management Terms. Index.