Venture Capital Documentation

I ran across a post at Software Only on “Venture Financing Concepts, Process and Documentation”.

There is also good legal documentation available for budding VCs and entrepreneurs at the National Venture Capital Association (NVCA). You might also like to pick up a copy of Term Sheets & Valuations by Alex Wilmerding. It takes a look at term sheets line by line and discusses Company favorable, Neutral and Investor favorable terms.

All of these are US documents, which are 80% relevant for the UK market, however, there are some important differences (i.e. pre-emption, tag-along/drag-along, preference shares). The BVCA does offer “A Guide to Venture Capital Termsheets”, which will introduce these concepts. Hopefully they will be releasing further documentation shortly. There’s no direct link to the Termsheet guide: Go to the BVCA > Publications/Research> Non-members and then scroll down. You can download the file or order a nicely bound paper copy for free.

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