Looking for ways to cut costs when financing deals, to open up transparency and to increase fairness in the market? Open sourced term sheets are one way to achieve all of these things. For your convenience, the Unreasonable Institute has compiled these sheets in one central place.
Reading blogs and understanding sample term sheets does not make you an expert. Tweet This Quote
Open sourced term sheets, and the numerous blogs surrounding them, have done wonders for entrepreneurs and investors. These resources are available thanks to folks like Foundry Group, TechStars, YCombinator and NVCA. Public access to open sourced term sheets has dramatically driven down the cost of doing financing deals, opened up transparency and increased fairness in the market.
That said, entrepreneurs must be cautious with these resources. Access to this information is not a reason to become overly confident. Reading blogs and understanding sample term sheets does not make you an expert. The stakes are massive. Mistakes on an early term sheet can bring about a host of problems including, but certainly not limited to, ruining your ability to raise future fund opportunities, losing control of your company or running your operation into the ground. We do not recommend approaching the issue of term sheets alone. It is crucial to work on your capital raise and term sheets with people who know this stuff (see: lawyers or very experienced mentors/advisors).
This post is intentionally short. Beyond general suggestions, I leave further commentary to the experienced investors (which I am not). This page is meant to be a centralizer of resources and open source documents that are out there for funding term sheets. We hope you bookmark the linked site and refer back to it often. If you have documents and resources you would like to share with fellow entrepreneurs who are also trying to solve the world’s biggest problems, please add them to the comments (and, please, only ones you are allowed to share – nothing confidential).
This article is being re-featured today as a special “Throwback Thursday” post. We loved it so much, we wanted to make sure all of our new readers had a chance to read this article, (and share in the conversation).