Don’t Shop Your Term Sheet

From VC’s perspective, one of the most annoying things an entrepreneur can do is “shop” a term sheet.  That means after they’ve offered you a term sheet in writing you take it to other investors to try to get a better deal. Why are investors so sensitive to this?  First of all, no investor wants to think they are “just money” – the idea that you want to get an explicit auction going suggests that. More importantly, what often happens is that once a VC has offered you a term sheet – especially if that VC is well respected – other VCs suddenly become interested.


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Chris Dixon

Chris Dixon is an investor at Andreessen Horowitz. He was previously the Co-Founder/CEO of Hunch, Co-Founder of Founder Collective, and Co-Founder/CEO of SiteAdvisor.

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Filed Under:
Collection: Funding
Category: Negotiating & Closing