Episode 4: Preferred Stock Funding (Part 2 - The Term Sheet)
 41 min watch

You've received a term sheet. Venture financing beckons. What practical implications do typical deal terms have? What do you need to know to protect and grow your company?

In the second of this three-part episode, Orrick's Aria Kashefi, John Bautista and Laura Barr demystify deal terms in the VC funding process, answering questions such as:

• What is preferred stock? How does it differ from common stock?
• What are liquidation and dividend preferences? How do protection provisions work?
• Do investors get a seat on the board?
• What key points distinguish conversion and pro rata rights from information and registration rights?
• What mistakes have companies made while going through a financing?

Resources:

• Series A Readiness Tool
• Term Sheet Creator
• Startup Forms: Founder's Stock Purchase