A Comprehensive Guide for Biomedical Entrepreneurs
Navigate the complex world of venture capital funding with confidence
Introduction: The Critical Importance of Term Sheets
In the high-stakes world of biomedical innovation, securing venture capital funding can mean the difference between bringing a life-saving therapy to market and watching your breakthrough discovery remain in the laboratory. At the heart of every successful funding round lies a document that, despite its deceptively simple appearance, can determine the fate of your company: the term sheet.
For biomedical founders, understanding term sheets isn't just about securing capital—it's about maintaining control over your vision, protecting your intellectual property, and ensuring that the investors you bring on board truly understand the unique challenges and opportunities in healthcare innovation.
Why Biomedical Term Sheets Are Different
Unlike software startups that can pivot quickly and scale rapidly, biomedical companies face unique challenges that must be reflected in their term sheets:
- Extended Development Timelines: Drug development can take 10-15 years from discovery to market
- Regulatory Complexity: FDA approval processes require specialized investor understanding
- Capital Intensity: Clinical trials can cost hundreds of millions of dollars
- IP Considerations: Patent landscapes are complex and critical to valuation
- Risk Profiles: High failure rates require different risk-sharing mechanisms
This comprehensive guide will walk you through every aspect of term sheet anatomy, with specific focus on the nuances that matter most to biomedical entrepreneurs. By the end, you'll have the knowledge and confidence to negotiate terms that protect your interests while attracting the right investors for your journey.
Term Sheet Basics: Foundation Knowledge
What Is a Term Sheet?
Term Sheet Definition: A non-binding document that outlines the basic terms and conditions of an investment. It serves as a template for drafting the definitive legal documents and establishes the framework for the investor-company relationship.
Think of a term sheet as the architectural blueprint for your funding round. Just as you wouldn't build a biomedical facility without detailed plans, you shouldn't proceed with investment without a comprehensive term sheet that addresses all critical aspects of the deal.
The Dual Nature of Term Sheets
Term sheets serve two primary functions that biomedical founders must understand:
- Economic Terms: How much money you're raising, at what valuation, and how returns will be distributed
- Control Terms: Who makes decisions, how the board is structured, and what rights investors have
The Biomedical Founder's Dilemma
Many biomedical founders focus exclusively on valuation and the amount of capital raised, overlooking control terms that can significantly impact their ability to execute their vision. In biomedical ventures, where pivots are less common and the path to market is more defined, maintaining strategic control is often more important than maximizing valuation.
Timeline and Process
The term sheet process typically follows this timeline:
- Initial Discussions (2-4 weeks): Investor interest and preliminary terms
- Due Diligence (4-8 weeks): Deep dive into your science, IP, and business model
- Term Sheet Negotiation (1-2 weeks): Back-and-forth on key terms
- Legal Documentation (4-6 weeks): Converting terms into binding agreements
- Closing (1-2 weeks): Final signatures and fund transfer
⚠️ Biomedical Timeline Reality Check
For biomedical companies, especially those requiring FDA interaction or complex IP analysis, due diligence can extend to 12-16 weeks. Plan accordingly and maintain sufficient runway to complete the process without desperation driving poor decisions.
Key Terms Every Biomedical Founder Must Understand
Valuation Terms
Pre-Money vs. Post-Money Valuation
Pre-Money Valuation: The value of your company before the investment
Post-Money Valuation: Pre-money valuation + investment amount
Understanding this distinction is crucial for calculating your ownership percentage after the investment. If your company has a $20M pre-money valuation and you raise $5M, your post-money valuation is $25M, and the investor owns 20% ($5M ÷ $25M).
Biomedical Valuation Considerations
Biomedical company valuations often rely on risk-adjusted net present value (rNPV) models that consider:
- Probability of technical success at each development stage
- Regulatory approval probabilities
- Market size and penetration assumptions
- Competitive landscape and patent protection
- Time to market and development costs
Option Pool
The option pool represents shares set aside for employee equity compensation. This is typically 10-20% of the company and is usually carved out of the pre-money valuation, effectively reducing founder ownership.
💡 Negotiation Tip
Try to negotiate the option pool size based on your actual hiring plans over the next 18-24 months. Biomedical companies often need specialized talent (regulatory affairs, clinical operations) that commands higher equity packages.
Liquidation Preferences
Liquidation preferences determine the order and amount of payouts when the company is sold or liquidated. This is one of the most critical terms for founders to understand.
Types of Liquidation Preferences
Type |
Description |
Founder Impact |
Biomedical Relevance |
Non-Participating Preferred |
Investors get their money back first, then convert to common |
Moderate |
Standard for early-stage biomedical deals |
Participating Preferred |
Investors get money back AND participate in remaining proceeds |
High negative impact |
Rare but seen in high-risk platform deals |
Capped Participation |
Participating preferred with a cap on total return |
Moderate |
Compromise solution for uncertain biomedical outcomes |
Case Study: The $100M Biomedical Exit
Consider a biomedical company that raised $20M with 1x non-participating preferred stock and is acquired for $100M:
- Scenario A (Non-Participating): Investors choose to convert to common stock and receive $20M of the $100M based on their ownership percentage
- Scenario B (Participating): Investors get their $20M back first, then participate in the remaining $80M based on ownership
The difference can be millions of dollars in founder returns.
Anti-Dilution Provisions
Anti-dilution provisions protect investors from dilution if the company raises money at a lower valuation in future rounds.
Types of Anti-Dilution Protection
- Full Ratchet: Adjusts the conversion price to the new, lower price
- Weighted Average (Broad-Based): Considers all outstanding shares in the adjustment
- Weighted Average (Narrow-Based): Only considers common stock and options
⚠️ The Down Round Reality
Biomedical companies face higher risks of down rounds due to clinical trial failures or regulatory setbacks. Negotiate anti-dilution terms carefully, as full ratchet provisions can severely punish founders and employees in these scenarios.
Dividend Provisions
Most biomedical term sheets include cumulative dividend provisions, typically 6-10% annually. These dividends accrue and are paid upon liquidation or redemption, effectively increasing the liquidation preference over time.
Redemption Rights
Redemption rights allow investors to force the company to buy back their shares after a certain period, typically 5-7 years. For biomedical companies with long development timelines, this can create significant pressure.
Biomedical-Specific Redemption Considerations
Given the extended timelines in drug development, consider negotiating:
- Longer redemption periods (7-10 years)
- Milestone-based extensions for regulatory approvals
- Partial redemption options to manage cash flow
Biomedical-Specific Considerations
Intellectual Property Terms
In biomedical ventures, intellectual property often represents the majority of company value. Term sheets should address several IP-specific considerations:
IP Assignment and Ownership
- Founder IP: Ensure clear assignment of pre-existing IP to the company
- University Licenses: Address any licensing agreements with academic institutions
- Employee Inventions: Establish clear policies for employee-generated IP
- Consultant IP: Ensure proper assignment from advisors and consultants
The University License Trap
Many biomedical startups license technology from universities. Investors will scrutinize these agreements for exclusivity, field of use restrictions, milestone payments, and royalty obligations. Ensure your term sheet addresses how these obligations affect investor returns.
Regulatory Milestone Provisions
Biomedical term sheets often include provisions tied to regulatory milestones:
- IND Filing: Investigational New Drug application submission
- Phase I Completion: Safety study completion
- Phase II Results: Efficacy signal demonstration
- FDA Meetings: End-of-Phase II or pre-BLA meetings
- Regulatory Approval: FDA approval or international equivalents
Milestone-Based Valuation Adjustments
Some sophisticated biomedical investors negotiate valuation adjustments based on milestone achievement:
Milestone Ratchets: Provisions that adjust investor ownership based on the achievement or failure to achieve specific development milestones within defined timeframes.
Clinical Trial Considerations
Clinical trials represent the highest risk and cost component of biomedical development. Term sheets should address:
Trial Design Approval Rights
- Investor consent rights for trial protocols
- Budget approval for clinical studies
- CRO selection and management oversight
- Data safety monitoring board composition
Failure Scenario Planning
⚠️ Clinical Trial Failure Provisions
Address what happens if clinical trials fail to meet endpoints. Consider provisions for:
- Alternative indication exploration
- Asset sale or licensing rights
- Pivot strategies and approval processes
- Liquidation procedures and asset distribution
Manufacturing and Supply Chain
For biomedical companies, manufacturing capabilities and supply chain security are critical. Term sheets may include:
- Manufacturing Strategy Approval: Investor consent for make-vs-buy decisions
- Supply Agreement Review: Rights to review critical supplier contracts
- Quality System Oversight: Board involvement in GMP compliance
- Scale-Up Planning: Capital allocation for manufacturing scale-up
Partnership and Licensing Provisions
Biomedical companies often require strategic partnerships for development, manufacturing, or commercialization. Key term sheet provisions include:
Strategic Partnership Approval Rights
Partnership Type |
Typical Approval Threshold |
Key Considerations |
Development Partnerships |
Board majority |
IP ownership, milestone payments, termination rights |
Licensing Deals |
Investor consent |
Exclusivity, field restrictions, royalty rates |
Manufacturing Agreements |
Board approval for >$5M |
Quality standards, capacity allocation, pricing |
Commercial Partnerships |
Supermajority |
Territory rights, revenue sharing, co-promotion |
Valuation and Pricing Mechanisms
Biomedical Valuation Methodologies
Biomedical company valuations require specialized approaches that account for the unique risk-return profiles of healthcare innovation:
Risk-Adjusted Net Present Value (rNPV)
The gold standard for biomedical valuation, rNPV models incorporate:
- Probability of Technical Success (PTS): Likelihood of achieving development milestones
- Probability of Regulatory Success (PRS): FDA approval probabilities by indication
- Market Penetration Models: Adoption curves and competitive dynamics
- Development Costs: Phase-specific cost estimates
- Time Value of Money: Discount rates reflecting biomedical risk
Industry-Standard Success Probabilities
Understanding these benchmarks helps in valuation discussions:
- Preclinical to IND: 85-90%
- Phase I Success: 60-70%
- Phase II Success: 30-40%
- Phase III Success: 60-70%
- Overall Success (Preclinical to Approval): 10-15%
Comparable Company Analysis
Public biomedical companies provide valuation benchmarks, but comparisons must account for:
- Development stage alignment
- Indication similarity and market size
- Platform vs. single-asset approaches
- IP strength and competitive positioning
- Management team experience
Valuation Negotiation Strategies
The Milestone-Based Approach
Rather than fighting over a single valuation, consider milestone-based structures:
Case Study: Milestone-Based Valuation
A gene therapy company negotiates a $50M pre-money valuation with adjustments:
- Base Case: $50M pre-money for $15M investment
- IND Approval (6 months): Retroactive adjustment to $60M pre-money
- Phase I Safety (18 months): Additional warrant coverage at $75M valuation
- Phase II Efficacy (36 months): Anti-dilution protection waiver
This structure aligns investor and founder interests while providing upside for execution.
Platform vs. Product Valuations
Platform companies (multiple products from single technology) command premium valuations but face different investor expectations:
Aspect |
Single Product |
Platform Technology |
Valuation Multiple |
1x peak sales |
2-3x peak sales |
Risk Profile |
Binary outcome |
Diversified risk |
Capital Requirements |
Focused investment |
Higher capital needs |
Timeline to Value |
Single pathway |
Multiple value inflection points |
Pricing Mechanisms and Structures
Convertible Securities
Many biomedical seed rounds use convertible instruments to defer valuation decisions:
- Convertible Notes: Debt that converts to equity in future rounds
- SAFEs: Simple Agreement for Future Equity
- Convertible Preferred: Preferred stock with conversion features
💡 Biomedical Convertible Considerations
For biomedical companies, consider:
- Longer maturity periods (3-5 years) to accommodate development timelines
- Milestone-triggered conversion events
- Qualified financing thresholds appropriate for biomedical capital needs
- Discount rates that reflect biomedical risk premiums
Liquidation Preferences: Protecting Your Interests
Understanding Liquidation Waterfalls
The liquidation waterfall determines how proceeds are distributed when your company is sold, merged, or liquidated. For biomedical founders, understanding these mechanics is crucial because acquisition is often the primary exit strategy.
The Basic Waterfall Structure
- Debt and Obligations: Outstanding loans and liabilities
- Liquidation Preferences: Preferred stockholder preferences
- Remaining Proceeds: Distributed based on ownership percentages
Case Study: The $200M Biomedical Acquisition
BioTech Inc. raised $40M across two rounds and is acquired for $200M:
Round A: $15M at $35M pre-money (30% ownership) with 1x non-participating preferred
Round B: $25M at $75M pre-money (25% ownership) with 1x non-participating preferred
Founders/Employees: 45% ownership
Liquidation Analysis:
- Series B Preference: $25M
- Series A Preference: $15M
- Remaining for Common: $160M
Distribution:
- Series B: $25M + (25% × $160M) = $65M
- Series A: $15M + (30% × $160M) = $63M
- Founders/Employees: 45% × $160M = $72M
Participation Rights Deep Dive
The Participation Spectrum
Understanding the full spectrum of participation rights helps in negotiations:
Participation Type |
Investor Gets |
Founder Impact |
When Acceptable |
Non-Participating |
Preference OR conversion |
Minimal |
Standard terms |
Participating |
Preference AND pro-rata share |
Severe |
High-risk early stage only |
Capped Participation |
Participating up to cap |
Moderate |
Compromise solution |
⚠️ The Participation Trap
Participating preferred can create scenarios where investors receive the majority of proceeds even with minority ownership. In biomedical companies where exits often occur at moderate multiples (2-5x invested capital), this can leave founders with minimal returns despite successful outcomes.
Multiple Liquidation Preferences
Some investors negotiate multiple liquidation preferences (2x, 3x, or higher), meaning they receive multiple times their investment before other shareholders participate.
When Multiples Make Sense
- Bridge Financing: High-risk situations requiring immediate capital
- Turnaround Situations: Companies facing significant challenges
- Late-Stage Growth: Large investments in proven companies
Biomedical Multiple Considerations
In biomedical contexts, multiples might be justified for:
- Rescue financing after clinical trial failures
- Bridge funding to strategic partnerships
- Late-stage manufacturing scale-up capital
- Regulatory approval bridge financing
Negotiating Liquidation Terms
Founder-Friendly Alternatives
- Tiered Preferences: Lower multiples for higher exit values
- Time-Based Decay: Preferences that decrease over time
- Milestone-Based Adjustments: Preferences that adjust based on achievements
- Conversion Incentives: Bonus shares for converting to common
💡 The Conversion Threshold Strategy
Negotiate conversion thresholds where investors must convert to common stock above certain exit values. For example, if the exit value exceeds 3x the post-money valuation, all preferred converts to common, ensuring founders participate meaningfully in large exits.
Carve-Out Provisions
Consider negotiating carve-outs that protect founder and employee interests:
- Management Carve-Out: Percentage of proceeds reserved for management team
- Employee Pool Protection: Minimum allocation for employee option holders
- Founder Minimum: Guaranteed minimum return for founders
Board Composition and Governance Rights
Board Structure Fundamentals
The board of directors controls major company decisions, making its composition one of the most critical aspects of your term sheet. For biomedical companies, board expertise in regulatory affairs, clinical development, and commercialization is essential.
Typical Board Compositions by Stage
Stage |
Board Size |
Founder Seats |
Investor Seats |
Independent Seats |
Seed |
3 |
2 |
1 |
0 |
Series A |
5 |
2 |
2 |
1 |
Series B |
7 |
2 |
3 |
2 |
Later Stage |
7-9 |
1-2 |
3-4 |
3-4 |
Biomedical Board Expertise Requirements
Biomedical boards require specialized expertise that general technology investors may lack:
Essential Board Competencies
- Regulatory Affairs: FDA interaction and approval processes
- Clinical Development: Trial design and execution experience
- Commercial Strategy: Healthcare market access and reimbursement
- Manufacturing: GMP compliance and scale-up experience
- Business Development: Pharma partnership and licensing
- Financial Management: Biomedical capital allocation and planning
Independent Director Selection
For biomedical companies, independent directors should ideally have:
- Previous biomedical CEO or senior executive experience
- Successful drug development track record
- Regulatory agency experience (former FDA officials)
- Big pharma business development background
- Public company board experience in healthcare
Board Decision-Making Mechanisms
Voting Structures
Different decisions require different approval thresholds:
- Simple Majority: Routine operational decisions
- Supermajority: Major strategic decisions (typically 66.7%)
- Unanimous: Fundamental changes (rare, but sometimes required)
Protective Provisions
Investors typically negotiate protective provisions requiring their consent for major decisions:
Protective Provisions: Specific decisions that require investor approval, regardless of board composition. These protect investor interests in key areas while allowing management flexibility in day-to-day operations.
Standard Protective Provisions
- Issuance of new securities
- Sale of company or major assets
- Changes to charter or bylaws
- Dividend declarations
- Liquidation or dissolution
- Changes to board size or composition
- Executive compensation above thresholds
- Annual budget approval
Biomedical-Specific Protective Provisions
Biomedical term sheets often include additional protective provisions:
- Clinical Trial Protocols: Approval of Phase II/III trial designs
- Regulatory Strategy: FDA meeting strategies and submissions
- IP Strategy: Patent filing and licensing decisions
- Manufacturing Decisions: Make-vs-buy and facility investments
- Partnership Agreements: Strategic alliances and licensing deals
- Indication Expansion: New therapeutic area exploration
⚠️ The Governance Gridlock Risk
Too many protective provisions can create decision-making gridlock, particularly problematic for biomedical companies that must respond quickly to regulatory feedback or clinical trial results. Negotiate reasonable thresholds and emergency decision-making procedures.
Information Rights and Reporting
Standard Information Rights
Investors typically receive extensive information rights:
- Monthly Reports: Financial statements and key metrics
- Annual Budgets: Detailed financial planning documents
- Board Materials: Pre-meeting packages and presentations
- Inspection Rights: Access to facilities and records
- Financial Audits: Annual audited financial statements
Biomedical-Enhanced Reporting
Biomedical investors often require additional reporting:
- Clinical Trial Updates: Patient enrollment and safety data
- Regulatory Communications: FDA correspondence and meeting minutes
- IP Portfolio Reports: Patent prosecution and competitive landscape
- Manufacturing Reports: Quality metrics and supply chain status
- Partnership Updates: Strategic alliance progress and negotiations
💡 Balancing Transparency and Efficiency
While investors deserve comprehensive information, excessive reporting requirements can burden management. Negotiate standardized reporting formats and reasonable frequency to maintain focus on execution while keeping investors informed.
Anti-Dilution Provisions
Understanding Anti-Dilution Mechanics
Anti-dilution provisions protect investors from ownership dilution when companies raise capital at lower valuations than previous rounds. For biomedical companies, which face higher risks of down rounds due to clinical failures or regulatory setbacks, these provisions can significantly impact founder ownership.
Types of Dilutive Events
Anti-dilution provisions typically protect against:
- Down Rounds: Fundraising at lower valuations
- Stock Splits: Subdivision of existing shares
- Stock Dividends: Distribution of additional shares
- Below-Market Issuances: Shares issued below fair market value
Anti-Dilution Formulas
Full Ratchet Anti-Dilution
Full Ratchet: The conversion price of preferred stock is adjusted to equal the price of the new issuance, regardless of the number of shares issued.
This is the most investor-friendly (and founder-unfriendly) form of anti-dilution protection.
Case Study: Full Ratchet Impact
BioMed Corp raised $10M at $2.00 per share ($20M pre-money). Due to clinical trial delays, they raise $5M at $1.00 per share.
Without Anti-Dilution:
- Series A: 5M shares at $2.00
- Series B: 5M shares at $1.00
- Series A ownership: 33.3%
With Full Ratchet:
- Series A conversion price adjusts to $1.00
- Series A now owns 10M shares (equivalent)
- Series A ownership: 50%
The founders and employees bear the full burden of the down round dilution.
Weighted Average Anti-Dilution
Weighted average formulas consider both the price and quantity of new shares issued, providing more balanced protection.
Broad-Based Weighted Average
Includes all outstanding securities in the calculation:
Formula: NCP = OCP × [(A + B) ÷ (A + C)]
Where:
• NCP = New Conversion Price
• OCP = Old Conversion Price
• A = Outstanding shares before issuance
• B = Shares that could be purchased at old price with new money
• C = New shares actually issued
Narrow-Based Weighted Average
Only includes common stock and options in the calculation, providing stronger investor protection than broad-based.
Biomedical Anti-Dilution Considerations
Given the higher probability of down rounds in biomedical ventures:
- Negotiate broad-based weighted average rather than full ratchet
- Consider carve-outs for strategic rounds or partnerships
- Include sunset provisions that expire after successful milestones
- Negotiate pay-to-play provisions that require investor participation to maintain anti-dilution rights
Exceptions and Carve-Outs
Most anti-dilution provisions include exceptions for certain types of issuances:
Standard Carve-Outs
- Employee Option Pool: Shares reserved for employee compensation
- Conversion of Securities: Conversion of existing preferred or debt
- Stock Splits and Dividends: Proportional adjustments to all shareholders
- Strategic Partnerships: Shares issued to strategic partners at below-market rates
Biomedical-Specific Carve-Outs
- Grant-Related Issuances: Shares issued to satisfy government grant requirements
- University Licensing: Shares issued to academic institutions as part of licensing agreements
- Clinical Trial Partnerships: Equity issued to clinical research organizations
- Regulatory Milestone Bonuses: Shares issued upon achieving regulatory approvals
Pay-to-Play Provisions
Pay-to-Play: Provisions that require investors to participate in future financing rounds to maintain certain rights, including anti-dilution protection.
These provisions can help ensure investor commitment during difficult periods:
Typical Pay-to-Play Consequences
- Loss of Anti-Dilution Rights: Non-participating investors lose protection
- Conversion to Common: Preferred stock converts to common
- Loss of Board Rights: Forfeiture of board representation
- Reduced Liquidation Preference: Preference amount decreases
💡 Negotiating Pay-to-Play Terms
For biomedical companies, consider:
- Reasonable participation thresholds (pro-rata or minimum amounts)
- Exceptions for investors facing regulatory restrictions
- Grace periods for investors to arrange participation
- Partial penalties rather than complete loss of rights
Negotiation Strategies for Biomedical Founders
Pre-Negotiation Preparation
Know Your Leverage Points
Successful term sheet negotiations require understanding your unique value proposition and leverage points:
- Scientific Differentiation: Unique mechanism of action or novel targets
- IP Strength: Strong patent portfolio with broad claims
- Regulatory Advantages: Orphan drug designation, fast track status
- Clinical Data: Positive preclinical or early clinical results
- Team Expertise: Proven track record in drug development
- Strategic Interest: Multiple potential acquirers or partners
- Market Timing: Favorable regulatory or competitive environment
Biomedical-Specific Leverage
Unique leverage points for biomedical companies:
- Unmet Medical Need: Addressing diseases with no current treatments
- Regulatory Pathway Clarity: Clear FDA guidance or precedent
- Biomarker Strategy: Validated biomarkers for patient selection
- Manufacturing Advantages: Proprietary production methods
- Key Opinion Leader Support: Endorsements from leading physicians
Market Research and Benchmarking
Understand market terms for comparable deals:
- Stage-Appropriate Comparisons: Companies at similar development stages
- Indication-Specific Benchmarks: Deals in your therapeutic area
- Investor Track Record: Historical terms from your potential investors
- Recent Market Conditions: Current biomedical funding environment
Negotiation Tactics and Strategies
The Collaborative Approach
Unlike adversarial negotiations, biomedical term sheet discussions should focus on alignment and partnership:
- Shared Vision: Emphasize common goals for patient impact
- Risk Sharing: Structure terms that align risk and reward
- Long-term Partnership: Focus on multi-round relationship building
- Expertise Value: Highlight investor's strategic value beyond capital
Prioritizing Terms
Not all terms are equally important. Prioritize your negotiation focus:
Priority Level |
Terms |
Rationale |
Negotiation Approach |
Critical |
Valuation, Board Control, Liquidation Preference |
Fundamental economics and control |
Stand firm, seek win-win solutions |
Important |
Anti-dilution, Protective Provisions, Option Pool |
Significant long-term impact |
Negotiate actively, consider trade-offs |
Standard |
Information Rights, Tag-along, Drag-along |
Market standard terms |
Accept reasonable market terms |
Creating Win-Win Scenarios
Structure terms that benefit both parties:
Case Study: The Milestone-Linked Board Structure
A biomedical company negotiates board control based on performance milestones:
Initial Structure: 2 founder seats, 2 investor seats, 1 independent (investor control)
Milestone Adjustments:
- IND Filing: Add 1 founder seat (founder control)
- Phase II Completion: Maintain founder control
- Fundraising Need: Revert to investor control if new round required
This structure incentivizes execution while providing investor protection during high-risk periods.
Common Negotiation Pitfalls
The Valuation Obsession
⚠️ Valuation Tunnel Vision
Many founders focus exclusively on valuation while ignoring terms that can have greater long-term impact. A higher valuation with participating preferred stock can result in lower founder returns than a lower valuation with standard terms.
Negotiating in Isolation
Common mistakes that weaken negotiating position:
- Single Investor Focus: Negotiating with only one potential investor
- Deadline Pressure: Accepting poor terms due to cash constraints
- Inexperienced Advisors: Using lawyers unfamiliar with biomedical deals
- Emotional Decision-Making: Letting frustration drive poor choices
Ignoring Future Implications
Consider how current terms affect future rounds:
- Signaling Effects: How terms signal company quality to future investors
- Precedent Setting: Terms that become standard for future rounds
- Investor Dynamics: How current investors will behave in future rounds
- Exit Implications: How terms affect acquisition attractiveness
Advanced Negotiation Techniques
The Package Deal Approach
Rather than negotiating terms individually, present comprehensive packages:
💡 Package Negotiation Example
Package A (Higher Valuation): $60M pre-money, participating preferred, investor board control
Package B (Founder-Friendly): $50M pre-money, non-participating preferred, founder board control
This approach helps investors understand trade-offs and can lead to creative solutions.
Milestone-Based Structures
Use development milestones to bridge valuation gaps:
- Valuation Adjustments: Retroactive valuation increases upon milestone achievement
- Warrant Coverage: Additional equity grants for milestone completion
- Liquidation Preference Reductions: Preferences that decrease with success
- Board Control Shifts: Control changes based on performance
The Strategic Investor Angle
Leverage strategic investor interest to improve terms:
- Validation Effect: Strategic interest validates technology and market
- Competitive Dynamics: Multiple strategics can drive better terms
- Partnership Potential: Future partnership opportunities add value
- Exit Optionality: Strategic investors as potential acquirers
When to Walk Away
Deal Breaker Scenarios
Some terms are worth walking away from:
- Excessive Participating Preferred: Terms that eliminate founder upside
- Unreasonable Control Provisions: Investor veto over routine decisions
- Punitive Anti-Dilution: Full ratchet with no carve-outs
- Inappropriate Board Composition: Investors without relevant expertise
- Misaligned Investor Expectations: Unrealistic timeline or milestone expectations
⚠️ The Desperation Trap
Never negotiate from a position of desperation. If you're running out of cash, consider bridge financing or alternative funding sources rather than accepting punitive terms that could destroy long-term value.
Red Flags and Deal Breakers
Investor Red Flags
Lack of Biomedical Experience
Investors without biomedical experience may not understand the unique challenges of drug development:
- Unrealistic Timelines: Expecting software-like development speeds
- Inappropriate Milestones: Setting milestones that don't align with regulatory processes
- Poor Risk Assessment: Underestimating clinical and regulatory risks
- Limited Network: Lack of connections to strategic partners or acquirers
Questions to Assess Biomedical Expertise
- How many biomedical companies have you invested in?
- What was the average time from investment to exit in your biomedical portfolio?
- Can you describe a challenging regulatory situation you've navigated?
- Who are your go-to experts for clinical development and regulatory affairs?
- What's your typical follow-on investment capacity for clinical trials?
Misaligned Investment Thesis
Ensure investor motivations align with your company's needs:
- Quick Flip Mentality: Investors seeking rapid exits incompatible with drug development timelines
- Platform vs. Product Mismatch: Platform investors in single-product companies or vice versa
- Stage Mismatch: Late-stage investors in early-stage companies
- Risk Tolerance Mismatch: Conservative investors in high-risk breakthrough therapies
Poor Reference Checks
Always conduct thorough reference checks with portfolio companies:
- Management Team Feedback: How does the investor work with management?
- Board Dynamics: Are they constructive or disruptive board members?
- Crisis Management: How do they behave when companies face challenges?
- Follow-on Support: Do they support companies in subsequent rounds?
- Exit Behavior: How do they handle exit negotiations?
Term Sheet Red Flags
Excessive Control Provisions
⚠️ Control Red Flags
- Supermajority Board Control: Requiring more than simple majority for routine decisions
- Excessive Protective Provisions: Investor veto over operational decisions
- Management Replacement Rights: Ability to replace founders without cause
- Hiring Approval Rights: Investor approval required for key hires
Punitive Economic Terms
- Multiple Liquidation Preferences: 2x or higher preferences without justification
- Full Participating Preferred: Investors get preference AND pro-rata participation
- Full Ratchet Anti-Dilution: No consideration for amount of new issuance
- Excessive Dividends: Cumulative dividends above market rates (8-10%)
Unreasonable Operational Constraints
Terms that unnecessarily constrain management flexibility:
- Micro-Management Provisions: Investor approval for routine business decisions
- Restrictive Employment Terms: Excessive non-compete or non-solicit provisions
- IP Assignment Issues: Unclear or problematic intellectual property ownership
- Exclusive Dealing Requirements: Restrictions on seeking additional investors
Due Diligence Red Flags
Inadequate Scientific Review
Investors who don't conduct proper scientific due diligence may not understand your technology:
- No Scientific Advisory Board Review: Failure to engage independent scientific experts
- Superficial IP Analysis: Limited patent landscape analysis
- No Regulatory Consultation: Failure to assess regulatory pathway
- Inadequate Competitive Analysis: Poor understanding of competitive landscape
Rushed Due Diligence Process
⚠️ Due Diligence Warning Signs
- Pressure to close without adequate review
- Reluctance to engage independent experts
- Focus only on financial metrics, ignoring scientific merit
- Unwillingness to discuss potential challenges or risks
Legal and Structural Red Flags
Problematic Legal Structure
- Complex Ownership Structures: Unnecessarily complicated cap tables
- Unclear Voting Agreements: Ambiguous voting or control provisions
- Problematic Jurisdiction: Incorporation in investor-favorable jurisdictions
- Inadequate Legal Representation: Pressure to use investor's lawyers exclusively
Missing Standard Protections
Ensure standard founder protections are included:
- Tag-Along Rights: Right to participate in founder share sales
- Co-Sale Rights: Protection against founder share transfers
- Information Rights: Access to company information and records
- Preemptive Rights: Right to maintain ownership percentage in future rounds
Cultural and Relationship Red Flags
Poor Communication Patterns
- Slow Response Times: Delayed responses to questions or requests
- Inconsistent Messaging: Different messages from different team members
- Lack of Transparency: Reluctance to discuss portfolio performance or challenges
- Pressure Tactics: Artificial deadlines or ultimatums
Misaligned Values
Biomedical Value Alignment
Ensure investors share your commitment to:
- Patient Impact: Genuine commitment to improving patient outcomes
- Scientific Rigor: Respect for evidence-based decision making
- Regulatory Compliance: Understanding of and commitment to regulatory requirements
- Long-term Thinking: Patience for extended development timelines
When Red Flags Appear
Assessment and Response
When you identify red flags, consider:
- Severity Assessment: Is this a deal-breaker or negotiable issue?
- Pattern Recognition: Is this an isolated issue or part of a broader pattern?
- Direct Communication: Address concerns directly with the investor
- Alternative Options: Evaluate other potential investors
- Professional Advice: Consult with experienced advisors and lawyers
💡 The Red Flag Response Framework
Minor Issues: Address through negotiation and documentation
Moderate Issues: Seek compromises or alternative structures
Major Issues: Consider walking away or finding different investors
Remember: The wrong investor can be worse than no investor.
Due Diligence Process
Understanding the Due Diligence Timeline
Due diligence is the comprehensive investigation process that investors conduct before finalizing their investment. For biomedical companies, this process is typically more extensive and time-consuming than for other industries due to the technical complexity and regulatory requirements.
Typical Due Diligence Timeline
Phase |
Duration |
Key Activities |
Biomedical Focus Areas |
Initial Review |
1-2 weeks |
Business plan review, management meetings |
Scientific rationale, IP overview |
Technical DD |
3-4 weeks |
Scientific advisory board review |
Preclinical data, regulatory strategy |
Commercial DD |
2-3 weeks |
Market analysis, competitive assessment |
Clinical development plan, reimbursement |
Legal/Financial DD |
2-3 weeks |
Legal documents, financial records |
IP portfolio, regulatory filings |
Final Review |
1-2 weeks |
Investment committee presentation |
Risk assessment, milestone planning |
Preparing for Due Diligence
The Data Room
A well-organized data room is crucial for efficient due diligence. For biomedical companies, this should include:
Scientific and Technical Documents
- Research Data: Preclinical studies, publications, conference presentations
- Regulatory Documents: IND applications, FDA correspondence, meeting minutes
- Clinical Protocols: Study designs, statistical analysis plans, CRO agreements
- Manufacturing Information: Process development, quality systems, supplier agreements
- Safety Data: Toxicology studies, adverse event reports, safety databases
Intellectual Property Portfolio
- Patent Applications: Filed and pending applications with prosecution history
- Patent Landscape Analysis: Competitive patent mapping and freedom to operate
- License Agreements: University licenses, in-licensing deals, out-licensing agreements
- Trade Secrets: Documentation of proprietary know-how and confidentiality measures
Biomedical Data Room Best Practices
- Scientific Summary: Executive summary of key scientific findings and rationale
- Regulatory Timeline: Detailed development and regulatory milestone timeline
- Competitive Analysis: Comprehensive competitive landscape assessment
- Key Opinion Leader Support: Letters of support from leading clinicians
- Manufacturing Strategy: Clear plan for scale-up and commercialization
Financial and Legal Documents
- Financial Statements: Audited financials, management accounts, budgets
- Cap Table: Current ownership structure and option pool details
- Legal Documents: Articles of incorporation, bylaws, board minutes
- Employment Agreements: Key employee contracts, consultant agreements
- Insurance Policies: D&O insurance, clinical trial insurance, product liability
Managing the Due Diligence Process
Setting Expectations
Establish clear expectations with investors about the due diligence process:
- Timeline: Agree on realistic timelines that account for biomedical complexity
- Resources: Identify key personnel who will support the process
- Confidentiality: Ensure proper NDAs are in place for sensitive information
- Expert Access: Arrange for investor access to key scientific advisors
Managing Multiple Investors
When conducting due diligence with multiple potential investors:
- Parallel Processes: Run due diligence processes in parallel when possible
- Shared Resources: Consider joint due diligence sessions for efficiency
- Confidentiality Management: Ensure competitive information remains protected
- Timeline Coordination: Align timelines to enable competitive dynamics
💡 Due Diligence Efficiency Tips
- Prepare standard Q&A documents addressing common investor questions
- Create executive summaries for complex technical documents
- Designate a single point of contact for due diligence coordination
- Schedule regular check-ins to address questions and concerns promptly
Key Due Diligence Focus Areas
Scientific and Technical Assessment
Investors will conduct thorough scientific review through:
- Scientific Advisory Board Review: Independent expert assessment of technology
- Key Opinion Leader Interviews: Discussions with leading clinicians in your field
- Competitive Analysis: Assessment of competitive threats and advantages
- Technical Risk Assessment: Evaluation of development and manufacturing risks
Regulatory Strategy Review
Regulatory due diligence typically includes:
- FDA Interaction History: Review of all regulatory communications
- Regulatory Pathway Assessment: Evaluation of approval strategy and timeline
- Clinical Development Plan: Review of trial designs and statistical plans
- Regulatory Consultant Input: Independent regulatory expert assessment
Case Study: Regulatory Due Diligence Challenge
A biomedical company faced intensive regulatory due diligence when investors discovered discrepancies between their regulatory strategy and FDA guidance documents.
Issue: Company planned a single pivotal trial, but FDA guidance suggested two trials might be required.
Resolution:
- Engaged regulatory consultant to provide independent assessment
- Scheduled pre-IND meeting with FDA to clarify requirements
- Adjusted development timeline and budget to account for potential second trial
- Negotiated milestone-based funding to manage increased risk
The transparent handling of this issue actually strengthened investor confidence in management's ability to navigate regulatory challenges.
Commercial Assessment
Commercial due diligence evaluates market opportunity and commercialization strategy:
- Market Size Analysis: Addressable market and growth projections
- Competitive Landscape: Current and pipeline competitive threats
- Pricing and Reimbursement: Payer acceptance and pricing strategy
- Go-to-Market Strategy: Sales and marketing approach
- Partnership Opportunities: Potential strategic alliances
Common Due Diligence Challenges
Information Overload
Biomedical companies often struggle with providing too much information:
⚠️ Information Management
- Focus on material information that affects investment decisions
- Provide executive summaries for complex technical documents
- Organize information logically with clear navigation
- Be prepared to explain the significance of technical findings
Confidentiality Concerns
Balancing transparency with confidentiality protection:
- Staged Disclosure: Reveal information progressively as investor commitment increases
- Clean Room Procedures: Use independent experts for sensitive technical review
- Redacted Documents: Provide summaries rather than full documents when appropriate
- Reference Restrictions: Limit investor contact with key personnel during process
Timeline Pressures
Managing due diligence timelines while maintaining business operations:
- Resource Planning: Allocate sufficient internal resources to support process
- External Support: Engage consultants for specialized due diligence areas
- Parallel Processing: Conduct different due diligence workstreams simultaneously
- Milestone Management: Set clear milestones and deadlines for each phase
Due Diligence Outcomes
Positive Outcomes
Successful due diligence can lead to:
- Term Sheet Confirmation: Validation of proposed terms and valuation
- Improved Terms: Better terms based on positive findings
- Strategic Value-Add: Investor commitment to provide strategic support
- Accelerated Timeline: Faster path to closing based on strong diligence
Challenging Outcomes
Due diligence may reveal issues requiring attention:
- Valuation Adjustments: Lower valuation based on identified risks
- Modified Terms: Additional protective provisions or milestone requirements
- Conditional Offers: Investment contingent on addressing specific issues
- Deal Termination: Investor withdrawal based on due diligence findings
💡 Turning Challenges into Opportunities
When due diligence reveals challenges:
- Address issues transparently and proactively
- Develop concrete plans to mitigate identified risks
- Use expert advisors to provide independent validation
- Consider how addressing issues strengthens the company long-term
From Term Sheet to Closing
The Legal Documentation Process
Once you've signed a term sheet, the next phase involves converting those terms into binding legal agreements. This process typically takes 4-8 weeks for biomedical companies, depending on the complexity of the deal and any unique provisions required.
Key Legal Documents
Document |
Purpose |
Key Provisions |
Biomedical Considerations |
Stock Purchase Agreement |
Defines investment terms and conditions |
Purchase price, closing conditions, representations |
IP warranties, regulatory compliance |
Amended Charter |
Creates new preferred stock class |
Rights, preferences, privileges of preferred stock |
Liquidation preferences, conversion terms |
Investor Rights Agreement |
Ongoing investor rights and protections |
Information rights, registration rights, board rights |
Clinical trial reporting, regulatory updates |
Voting Agreement |
Voting arrangements and board composition |
Board election, voting trusts, drag-along rights |
Scientific advisory board representation |
Right of First Refusal Agreement |
Transfer restrictions and co-sale rights |
ROFR, tag-along rights, transfer restrictions |
Founder departure scenarios |
Biomedical-Specific Legal Considerations
Intellectual Property Representations
Biomedical deals require extensive IP representations and warranties:
- Patent Ownership: Clear title to all patent applications and issued patents
- Freedom to Operate: No infringement of third-party patents
- Invention Assignment: Proper assignment of employee and consultant inventions
- University Licenses: Compliance with academic licensing obligations
- Trade Secrets: Adequate protection of proprietary information
IP Warranty Negotiation Points
- Knowledge Qualifiers: Limit warranties to management's actual knowledge
- Materiality Thresholds: Include materiality qualifiers for IP claims
- Survival Periods: Negotiate reasonable survival periods for IP warranties
- Indemnification Caps: Limit indemnification exposure for IP claims
Regulatory Compliance Representations
Investors require assurances about regulatory compliance:
- FDA Compliance: Adherence to applicable FDA regulations and guidance
- Clinical Trial Compliance: GCP compliance in all clinical studies
- Manufacturing Compliance: GMP compliance for drug substance and product
- Data Integrity: Accuracy and completeness of regulatory submissions
Clinical Trial and Safety Provisions
Special provisions may be required for ongoing or planned clinical trials:
- Clinical Trial Insurance: Adequate coverage for clinical studies
- Safety Reporting: Procedures for adverse event reporting
- Data Safety Monitoring: Independent oversight of clinical trials
- Trial Termination: Procedures for stopping trials if necessary
Closing Conditions and Requirements
Standard Closing Conditions
Typical conditions that must be satisfied before closing:
- Legal Documentation: Execution of all transaction documents
- Corporate Approvals: Board and stockholder approvals as required
- Due Diligence: Satisfactory completion of due diligence
- Representations True: All representations and warranties remain accurate
- No Material Adverse Change: No material adverse changes since term sheet
Biomedical-Specific Closing Conditions
- IP Opinions: Patent counsel opinions on key patents
- Regulatory Clearances: Any required regulatory approvals or clearances
- Clinical Trial Status: Confirmation of ongoing trial status and compliance
- Manufacturing Agreements: Key supplier or manufacturing agreements in place
- Insurance Policies: Clinical trial and product liability insurance
Case Study: Complex Biomedical Closing
A gene therapy company faced multiple closing challenges that extended their timeline by 6 weeks:
Challenges:
- University licensing agreement required amendment for investor comfort
- FDA raised questions about manufacturing process during IND review
- Key patent application faced rejection requiring response
- Clinical trial insurance required renegotiation for higher coverage
Resolution Strategy:
- Negotiated escrow arrangement for portion of investment pending patent resolution
- Obtained bridge financing to maintain operations during extended closing
- Engaged regulatory consultant to address FDA concerns
- Structured closing in tranches based on condition satisfaction
Managing the Closing Process
Project Management Approach
Successful closings require careful project management:
- Closing Checklist: Comprehensive list of all required actions and documents
- Timeline Management: Realistic timeline with buffer for unexpected issues
- Responsibility Matrix: Clear assignment of responsibilities to team members
- Regular Updates: Weekly status calls with all parties
- Issue Escalation: Process for addressing problems quickly
Legal Counsel Coordination
Effective coordination between company and investor counsel:
- Document Drafting: Agree on which party drafts each document
- Review Process: Establish efficient document review and comment process
- Negotiation Protocol: Direct lawyer-to-lawyer negotiations on technical issues
- Principal Involvement: Escalate business issues to principals promptly
💡 Closing Efficiency Tips
- Start legal documentation immediately after term sheet signing
- Address known issues proactively rather than waiting for discovery
- Maintain open communication channels between all parties
- Have backup plans for potential closing condition failures
Post-Closing Integration
Board and Governance Setup
Immediately after closing, establish proper governance:
- Board Meeting Schedule: Regular board meeting calendar
- Committee Structure: Audit, compensation, and other committees
- Reporting Systems: Monthly and quarterly reporting processes
- Communication Protocols: Regular investor communication procedures
Operational Integration
Integrate new investors into company operations:
- Strategic Planning: Incorporate investor input into strategic planning
- Network Access: Leverage investor networks for business development
- Expertise Utilization: Access investor expertise in key areas
- Future Funding: Begin planning for next funding round
Biomedical Post-Closing Priorities
- Scientific Advisory Board: Leverage investor networks to strengthen SAB
- Regulatory Strategy: Incorporate investor regulatory expertise
- Business Development: Use investor connections for partnership opportunities
- Clinical Development: Access investor networks for clinical expertise
Common Closing Pitfalls
Documentation Delays
- Over-Negotiation: Excessive focus on minor terms
- Scope Creep: Adding new terms not in the original term sheet
- Resource Constraints: Insufficient legal resources to handle complexity
- Coordination Issues: Poor coordination between multiple parties
Closing Condition Failures
⚠️ Common Closing Condition Issues
- Material adverse changes in business or market conditions
- Unexpected regulatory developments or FDA communications
- IP issues discovered during final patent review
- Key employee departures or employment issues
- Clinical trial problems or safety concerns
Prevention and Mitigation Strategies
- Early Issue Identification: Surface potential problems early in the process
- Contingency Planning: Develop backup plans for likely scenarios
- Flexible Structures: Build flexibility into closing conditions when possible
- Bridge Financing: Arrange bridge financing to cover extended timelines
- Communication: Maintain transparent communication with all stakeholders
Conclusion and Next Steps
Key Takeaways for Biomedical Founders
Navigating term sheet negotiations as a biomedical founder requires a unique blend of scientific expertise, business acumen, and strategic thinking. The stakes are particularly high in our industry, where the right investor partnership can mean the difference between bringing a life-saving therapy to market and watching promising science remain in the laboratory.
Critical Success Factors
- Preparation is Paramount: Thorough preparation, from understanding your leverage points to organizing comprehensive due diligence materials, sets the foundation for successful negotiations.
- Focus Beyond Valuation: While valuation matters, control terms, board composition, and investor expertise often have greater long-term impact on your success.
- Biomedical Expertise Matters: Partner with investors who understand the unique challenges of drug development, regulatory processes, and healthcare commercialization.
- Alignment is Essential: Ensure investor motivations, timelines, and risk tolerance align with the realities of biomedical innovation.
- Professional Support: Engage experienced legal counsel and advisors familiar with biomedical transactions.
The Biomedical Founder's Advantage
As a biomedical founder, you have unique advantages in term sheet negotiations:
- Mission-Driven Purpose: Your commitment to patient impact resonates with many investors
- Technical Expertise: Deep scientific knowledge provides credibility and negotiating strength
- Regulatory Clarity: Well-defined regulatory pathways provide predictable milestones
- Strategic Value: Potential for partnerships and acquisitions creates multiple exit paths
- Market Need: Addressing unmet medical needs provides compelling investment thesis
Building Long-Term Investor Relationships
Remember that signing a term sheet is just the beginning of a long-term partnership. The investors you choose will be with you through the inevitable challenges of drug development, regulatory hurdles, and market uncertainties.
Characteristics of Great Biomedical Investors
- Patient Capital: Understanding of and patience for extended development timelines
- Scientific Appreciation: Genuine respect for scientific rigor and evidence-based decision making
- Regulatory Experience: Track record of successfully navigating FDA processes
- Network Access: Connections to strategic partners, key opinion leaders, and potential acquirers
- Crisis Management: Experience helping companies navigate clinical setbacks and regulatory challenges
- Follow-On Commitment: Ability and willingness to support companies through multiple funding rounds
Preparing for Future Rounds
As you negotiate your current term sheet, consider how today's decisions will impact future fundraising:
Setting Positive Precedents
- Reasonable Terms: Fair terms signal company quality to future investors
- Investor Quality: High-quality investors attract other high-quality investors
- Milestone Achievement: Meeting or exceeding milestones strengthens negotiating position
- Governance Excellence: Strong governance practices build investor confidence
Avoiding Future Complications
- Complex Structures: Overly complex terms can complicate future rounds
- Punitive Provisions: Harsh terms may deter future investors
- Misaligned Investors: Investors with different objectives can create conflicts
- Inadequate Reserves: Insufficient option pools may require dilutive adjustments
Case Study: The Successful Multi-Round Journey
BioInnovate Inc. demonstrates how thoughtful term sheet negotiations enabled successful multi-round funding:
Series A (2019): $15M at $35M pre-money with broad-based weighted average anti-dilution
Series B (2021): $40M at $120M pre-money after successful Phase I results
Series C (2023): $80M at $300M pre-money following positive Phase II data
Exit (2024): $1.2B acquisition by major pharmaceutical company
Success Factors:
- Chose investors with deep biomedical expertise and patient capital
- Negotiated founder-friendly terms that attracted high-quality follow-on investors
- Maintained strong governance and regular communication with investors
- Achieved key development milestones on time and budget
- Built strategic relationships that ultimately led to acquisition
Action Steps for Biomedical Founders
Before You Start Fundraising
- Assess Your Readiness: Ensure you have compelling data and clear development plan
- Build Your Team: Assemble experienced legal counsel and advisors
- Prepare Materials: Develop comprehensive pitch deck and data room
- Research Investors: Identify investors with relevant expertise and portfolio fit
- Understand Market Terms: Research current market terms for comparable deals
During Term Sheet Negotiations
- Focus on Fit: Prioritize investor expertise and alignment over pure valuation
- Negotiate Holistically: Consider all terms together, not in isolation
- Plan for Scenarios: Consider how terms work in various success and failure scenarios
- Seek Win-Win Solutions: Structure terms that align investor and founder interests
- Document Everything: Ensure all agreements are clearly documented
After Signing the Term Sheet
- Manage the Process: Take active role in managing due diligence and closing
- Address Issues Promptly: Surface and resolve problems quickly
- Maintain Momentum: Keep all parties focused on efficient closing
- Plan Integration: Prepare for post-closing investor integration
- Execute Excellence: Focus on achieving milestones and building value
Final Thoughts
The term sheet negotiation process can seem daunting, but remember that you're not just raising capital—you're selecting partners who will help you navigate the complex journey of bringing innovative therapies to patients who need them. The time and effort you invest in understanding term sheets, preparing thoroughly, and negotiating thoughtfully will pay dividends throughout your company's development.
💡 Remember Your Mission
In the midst of complex negotiations and financial terms, never lose sight of your ultimate mission: developing therapies that improve and save lives. The best investor partnerships are built on shared commitment to this goal, with terms that enable rather than hinder your path to patient impact.
The biomedical industry needs innovative founders like you who are willing to take on the challenges of drug development. By mastering the art and science of term sheet negotiations, you're positioning yourself and your company for success in this critical endeavor.
Your patients are counting on you. Your investors are betting on you. Now go make it happen.