I think we can all agree for a first-time founder the request can be jarring at first.
However, it is also true that it’s pretty standard and not something that should make you shy away from the deal.
Just be mindful of ways you can protect yourself:
- Include terms for a cap on the legal fees
- Make sure that the fees are only payable once the deal is closed
- Have an attorney review the agreement
A term sheet is definitely a good sign that the investor is going to work with you, but this isn’t the end of negotiations. Everything in the document can be discussed and changed until you sign on the dotted line.
Discuss your options with an attorney and have a second pair of eyes review the document for good measure.can help. We offer flat-rate fees (which in your case really matters) and our attorneys are incredibly well-versed in startup law. Check us out and get in touch if you’d like us to give you hand.