This sample form, a Down-Round Term Sheet document, is usable for corporate/business matters. The language is easily adaptable to fit your circumstances. You must confirm compliance with applicable law in your state. Available in Word format.
Not necessarily! While it can signal challenges, it can also mean that the company is adapting to tougher times and looking for ways to turn things around. Every cloud has a silver lining!
Companies should weigh their options carefully, considering how a Down Round might impact their reputation and future fundraising ability. Sometimes it's wiser to weather the storm than to take the plunge.
Existing investors might feel a pinch since their shares could be worth less than before. However, it can also be a chance to double down and help the company bounce back.
Sometimes, despite their best efforts, companies hit a rough patch. A Down Round allows them to secure new funding to stay afloat and continue growing, even if it means accepting a lower valuation.
A Down Round Term Sheet is a document that outlines the terms of a funding round where the company's valuation is lower than in previous rounds. Think of it as a new beginning, even if the road hasn't been smooth.