Template · 20 min read + Word template

A Standard and Clean Series A Term Sheet (with downloadable template)

Jason Kwon and Aaron Harris · Y Combinator Free Intermediate

This is the one term sheet to benchmark your own against. YC wrote out the fairest single-page term sheet they could from having reviewed hundreds of Series A deals, and every bracketed item is exactly the clause that gets negotiated. It calls out the specific traps by name: participating preferred, cumulative dividends, and a 2-2-1 board versus the founder-friendly 2-1. Download the Word doc, drop your investor's term sheet beside it, and every deviation is a question you now know to ask.

  • The bracketed items in the template (beyond company and lead investor names) are precisely the terms that are always or frequently negotiated, so they are your negotiation checklist
  • Board control matters more than valuation: aim for a 2-1 (two common, one investor) structure, not the investor-heavy 2-2-1 that can let a board fire the founders
  • Clean means 1x non-participating liquidation preference, broad-based weighted average anti-dilution, and no cumulative dividends; anything richer for the investor is a flag
Open on ycombinator.com ↗

It answers 2 questions

  1. What are the key deal terms in a seed term sheet, and which ones actually matter?
  2. How do I read a term sheet without a lawyer so I know which clauses to actually fight over?

Read with it

  1. This is the clause-by-clause decoder written for Indian reality, not a US template retrofitted. It runs the founder-payout math... The Founder's Guide to Startup Funding (Indian Ecosystem) Article · 35 min read Term Sheet Analysis: The Most Important Document You'll Sign (The Founder's Guide to Startup Funding in the Indian Ecosystem) Niraj Kumar
  2. This is the ranked view of which terms actually bite, grounded in the NVCA model documents that most institutional term sheets... Glencoyne Article · 25 min read NVCA Term Sheet Standards: What Founders Must Know About Economics and Control Glencoyne Legal team
  3. Scott Kupor, who has run a16z's investing operations and written the book founders quietly read before a raise (Secrets of Sand... a16z Video · 20 min The Economics of Term Sheets Scott Kupor
  4. This is the term sheet guide written for the Indian cap table, using rupee exits (a ₹40 Cr sale on a ₹100 Cr paper valuation)... Malpani Ventures Article · 15 min read How to Read a Startup Term Sheet Like a Founder Malpani Ventures
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