From the course: Getting to Yes: Advice for Female Founders on How to Get Funded
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Steps after gaining interest
From the course: Getting to Yes: Advice for Female Founders on How to Get Funded
Steps after gaining interest
- Let's say that a venture capital firm is interested in investing in your company. The next step for them is due diligence. They will present you with an initial term sheet that will talk about the proposed amount of investment that they're interested in investing. They'll propose certain governance terms. Maybe they want a board seat, maybe they want follow-on rights, we call those pro rata rights for follow-on rounds of funding. They may want anti-dilution clauses, and then they'll probably put a valuation on it as well. The next step is going into due diligence. What should you be prepared for when a venture capital firm wants to do due diligence on your company or an investor? Often times seed stage investors, and certainly friends and family, won't perform as deep a diligence process, but the venture capital firms, as fiduciaries to their investors, have to perform a in-depth series of due diligence. The process starts with looking at the elements of your company. These are…
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