Tuesday, November 7, 202312:30 – 1:30 p.m. ESTSwartz Center for Entrepreneurship, 3rd Level, Tepper Quad/Virtual OptionPresenter: Matthew Weinbaum & David Kalson, Dentons
Negotiating your first term sheet for a convertible preferred stock equity financing can seem daunting. The terms typically come from a potential lead investor that has participated in financing rounds with dozens, if not hundreds, of emerging companies. Understanding your cap structure and what terms to push back on are important factors in determining what structural and economic control the original common stockholders will retain in the company post-financing. The purpose of this discussion is to walk through the Series Seed / Series A financing process, as well as the terms that are routinely negotiated in these early-stage financings. Through participating in this session, we hope to provide founders (and investors) with a better understanding of what a ‘clean,’ neutral term sheet should look like and what is required to bring such a financing round to close. Appreciating what’s ‘market’ will help parties avoid wasting time and capital on unnecessary points, while honing in on the terms that are important and relevant to the company’s future success.