If you build a company, when negotiations happen an angel investor or a VC might want to write you a check for a percentage of your company.

Generally an investor will pass you a term sheet, this is something that is non binding but is a layout of how the company will change, what the investor expects and if it is a good term sheet will motivate the startup team to progress the company.

Some more intesting info on term sheets:

• How to Negotiate a Term Sheet, Part I

Some terms you should know about term sheets:

• Drag Along Rights

Types of investments an investor will make:

• Convertible Debt

Tags: Angel Investors, Convertible Debt, Funding, Startups, Term Sheet, Venture Capital

This entry was posted on Thursday, March 11th, 2010 at 3:42 am and is filed under Entrepreneurs. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.