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Term Sheet: Basic Deal Economics
The term sheet is the central organizing document for start-up financing. The term sheet lays out the basic understanding between the company and the investor about the most important aspects of the investor's investment in the company. The term sheet is not the definitive agreement between the parties with respect to the financing because the definitive terms of the financing will be memorialized in a series (up to six) different agreements and corporate documents, each of which must be individually negotiated and agreed to.
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