Term Sheet
A non-binding document setting out the principal economic and control terms of a proposed investment. Serves as the basis for definitive transaction documents.
Term Sheet explained
A term sheet sets out the principal commercial terms of a proposed investment before definitive documents are drafted. Most of it is non binding, but it anchors the negotiation, and the terms that receive least attention at this stage, preferences, protective provisions and board composition, are usually the ones that matter most later.
How it works in practice
- Terms are recorded as structured fields, not stored only as a document.
- Economics are modelled into the cap table before signing.
- Exclusivity and confidentiality provisions are diarised.
Common mistake
Negotiating valuation carefully and accepting the control and preference terms without modelling them.
Why it matters in private capital
Term Sheet sits inside a chain of decisions that runs from sourcing through diligence, investment committee, portfolio monitoring and LP reporting. When each stage lives in a different tool, the evidence behind the decision is rebuilt at every handover. Keeping the concept on one record is what makes the fund able to explain, not just report, what it did.
How Reuben AI handles Term Sheet
Reuben AI is one platform for the full private capital workflow. Deal intake and screening at /deal-flow-management, diligence and IC memos at /ic-memo-software, portfolio monitoring and LP reporting at /lp-reporting-software all read from the same record, so Term Sheet does not need to be re-entered per tool. Pricing is at /pricing.
Frequently asked questions
What is Term Sheet?
A non-binding document setting out the principal economic and control terms of a proposed investment. Serves as the basis for definitive transaction documents.
How does Term Sheet work in practice?
A term sheet sets out the principal commercial terms of a proposed investment before definitive documents are drafted. Most of it is non binding, but it anchors the negotiation, and the terms that receive least attention at this stage, preferences, protective provisions and board composition, are usually the ones that matter most later.
What is the most common mistake with Term Sheet?
Negotiating valuation carefully and accepting the control and preference terms without modelling them.
How does Reuben AI handle Term Sheet?
Reuben AI keeps Term Sheet on the same record as sourcing, diligence, investment committee, portfolio monitoring and LP reporting, so the underlying evidence does not have to be rebuilt for each workflow.
Related terms
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