Part of raising capital effectively is understanding the basics and nuances of outside equity capital funding term sheets. It is critical to have a strong base of knowledge to help create your own company-driven term sheet or reviewing one submitted by a lead investor. Either way, become an expert in order to protect everyone's interests and enable strong working partnerships.
FROM AUMNI & NVCA: Aumni, in partnership with the National Venture Capital Association (NVCA), has released the latest version of the Enhanced Model Term Sheet v2.0. This update builds upon the original Enhanced Model Term Sheet launched in July 2020. Version 2.0 is the product of the largest analysis of private venture deal term data conducted to date.
Create term sheets with deeper insights The Enhanced Model Term Sheet allows an investor to draft term sheets while comparing terms against market benchmarks. Version 2.0 is powered by a database that now includes more than 100,000 venture transactions, representing over 40,000 investors with a combined network of over $1 trillion in assets under management.
Identify trends with 2020 data This release improves on v1.0 by providing deal term data that compares 2020 trends with previous years. Example analysis:
Insights on more deal terms Version 2.0 provides analyses on 13 additional deal terms, based on feedback from the venture community, providing unprecedented benchmark information:
Median Fully-Diluted Ownership Percent Purchased by New Money
Median Fully-Diluted Ownership Percent Purchased by Lead Investor
Median Percentage of Round Purchased by Lead Investor
NEW - Median Number of Investors (Syndicate) in an Equity Financing
NEW - Median Amount Raised in an Equity Financing in the Round ($M)
NEW - Median Convertible Principle and Interest of Convertible Notes in the Round
NEW - Median Valuation Cap in Convertible Security (All Types)
NEW - Median Option Pool Size as a Percentage of Fully-Diluted Post-Money Capitalization
NEW - Median Post-Money Valuation ($M)
NEW - Median Common Stock Issued as a Percent of Fully-Diluted Ownership
NEW - Frequency of Non-Cumulative Dividends
Frequency of 1x Liquidation Preference Multiplier
Frequency of Participating Preferred
NEW - Median Cap on Participating Preferred Stock
NEW - Frequency of Broad Based Anti-Dilution
Frequency of Pay-to-Play Provision
Frequency of Redemption Rights
Median Lead Investor Counsel Fee Cap
Frequency of Registration Rights
Median Major Investor Threshold as a Percent of New Money
Median Major Investor Threshold as a Percent of Fully-Diluted Ownership
NEW - Frequency of Pro-Rata Rights for All Investors in the Round
NEW - Frequency of Right of First Refusal (ROFR)
NEW - Median Number of Board Seats After the Round
Frequency of Drag-Along Rights
Click for Term Sheet Document Template
About Greg Fleishman
Greg Fleishman starts, nurtures, & funds Better-for-You CPG Brands that help make the world healthier as Co-Founder/CEO @foodstirs with Sarah Michelle Gellar | Founder @purelyrighteous, a top venture studio | Co-Founder @uptogoodenergy | Co-Founder @eatunion | Board Director for Lily's Sweets (exited to Hershey’s June 2021), Once Upon a Farm with Jennifer Garner, 4th & Heart Ghee, Nuun Hydration (exited to Nestle June 2021), & Demeter Biodynamic Farming USA | Venture Partner, Springdale Ventures | Operating Partner, Cambridge SPG VC | Operating Partner, Whipstitch Capital Investment Bank + Angel/LP Investor | Ex-Kashi, Kellogg, Coca-Cola | Forbes Top Consumer Catalyst | Visit Fata & Fleishman CPG Mentorship, a free support platform for early-stage entrepreneurs & investors.
About Mike Fata
Mike Fata co-founded Manitoba Harvest Hemp Foods in 1998. From 1998 to 2016, he ran all aspects of the company as Chairman of the Board and CEO. In February 2019 Mike helped guide the strategic sale of Manitoba Harvest to Tilray for $419 million dollars.
Mike is currently Chief Executive Officer of Fata & Associates, Chairman of Fata Family Ventures, Chairman of the Board of Sol Cuisine (VEG.TSXV), and investor/advisor to a portfolio of companies (including Om Mushrooms, Mid Day Squares, Love Good Fats, Good Cap Pharma)