Term Sheet

A term sheet is a document that outlines the key terms and conditions of an agreement, such as the size of a potential investment, the amount of equity and cash to be invested, vesting periods for stock options, board representation rights, management compensation, and so on.

Term sheets are typically used by startups to raise capital from venture capitalists or private equity firms. In these cases, it’s often referred to as “Series A” capital because it will be used to fund the company through its first major round of growth (i.e., Series A).