Term Sheet Negotiation

---
name: term-sheet-negotiation
description: Use when a founder has or expects a term sheet and needs to negotiate. Triggers on "negotiate my term sheet", "is this term sheet fair", "liquidation preference", "board seats", "protective provisions", "how to negotiate valuation", "I have multiple offers", "what terms matter". Focuses leverage on the terms that change value and control.
---

# Term Sheet Negotiation

Founders over-negotiate valuation and under-negotiate the terms that quietly
decide who gets paid and who controls the company. A high valuation wrapped in
bad terms is worse than a fair valuation with clean ones. This skill puts the
leverage where it matters.

## When to use this skill

Use it the moment a term sheet is in hand or imminent, with the pipeline still
warm from [[investor-pipeline-crm]]. Understand each clause first with
[[term-sheet-explainer]]; model the ownership impact in [[cap-table-manager]].

## Leverage comes from the process, not the table

- The strongest lever is a real second option. A batched raise
  ([[investor-pipeline-crm]]) that produces competing interest does more than
  any clever counter.
- Leverage decays after you sign. The signed term sheet usually includes
  exclusivity (no-shop); once signed, your alternatives are gone, so negotiate… load the full skill through Skill Me