RAISING FUNDS FROM INVESTORS? YOU NEED THESE FOUR DOCUMENTS

📍Pitch Deck:

Think of this as answering the question "tell me about yourself" in a job interview

This document provides the essential overview of your company

■What is your vision?

■What problem did your company set out to resolve?

■Your target market?

■ Marketing and Sales Strategy?

■ Traction so far

👉🏾There is no one way to create a pitch deck, the most important thing is to have information on critical aspects of your business

📍Term Sheet:

Think of this as answering the question "Why do you think you are fit for this role in this company" in a job interview

This document shows the terms of the investment and will necessarily contain details such as

●Amount of investment you're seeking

●Investors

●The security

●Pre money Valuation

●Dividends

●Liquidation Preference

●Voting rights

●Timing to close

📍Shareholders Agreement

This is a document that highlights shareholder's rights, responsibilities, liabilities, and obligations, as well as how the startup should run. A Shareholder Agreement protects the rights of existing shareholders as opposed to new parties wishing to purchase ownership of the company, as described by an investment agreement.

You will find important clauses such as

■ Governance and management body of the startup

■ Anti-dilution provisions

■ Restrictions on share transfers

■ ‘Drag-along’ right and ‘tag-along’ right

Investors may want to see the Shareholders Agreement in order to determine how their rights may be impacted.

📍Investment Agreement/Share Purchase Agreement

Now that the investor has agreed to invest in your the terms of the must be reduced into writing. The Investment Agreement governs the terms and conditions under which an investor (or a group of investors) injects capital into a company.

while the Share Purchase Agreement (SPA) governs the sale and transfer of ownership of shares in a company.