92.4
Concept
Term sheet red flags
Term sheet red flags shift economics, control, or optionality beyond the headline valuation. Preference stacks, board seats, protective provisions, and option-pool shuffle often matter more than the first-page number. Read for the second close — not the press release.
Where founders get this wrong
- Celebrating valuation while skimming preference, participation, and seniority language.
- Accepting an option-pool increase that dilutes founders pre-money without modeling it.
- Agreeing to broad protective provisions that turn every hire and pivot into a board event.
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