Valuation and deal structuring. First set of clauses are related to the valuation and deal structure. In this clause, we clearly define the investment amount and the percentage stake to be offered to the investor and what structure is used. It is a CCPS or is it a CCD or convertible node structure? Both these concepts are covered in detail in our course on understanding valuations and deal structuring. Uses of fund clause. Moving on to the next clause, which is uses of funds. This clause defines how the company will utilize the investment amount. When you present the business plan to the investors, you also share the details of your funding utilization. The business plan gets approved by the investor and so does the utilization of the investment proceeds. The founders have to stick to the utilization plan. In case there is any material deviation, say 10%, the founders have to go back to the investors and take an approval. To track the utilization, investor money is parked in a new bank account and no revenue is booked in that account. Also, there are certain restrictions. In case the company wants to spend more than the defined threshold amount in one go, let's say 25 lakhs, then 1. an explicit approval from the investor will be required. Three points are clearly defined in this clause. How will the funds be utilized? Approval mechanism for material change in fund utilization and spending beyond defined threshold and third, tracking process for funding utilization.


First set of clauses are related to the valuation and deal structure. In this clause, we clearly define the investment amount and the percentage stake to be offered to the investor and what structure is used. It is a CCPS or is it a CCD or convertible node structure? Both these concepts are covered in detail in our course on understanding valuations and deal structuring. Uses of fund clause. Moving on to the next clause, which is uses of funds. This clause defines how the company will utilize the investment amount. When you present the business plan to the investors, you also share the details of your funding utilization. The business plan gets approved by the investor and so does the utilization of the investment proceeds. The founders have to stick to the utilization plan. In case there is any material deviation, say 10%, the founders have to go back to the investors and take an approval. To track the utilization, investor money is parked in a new bank account and no revenue is booked in that account. Also, there are certain restrictions. In case the company wants to spend more than the defined threshold amount in one go, let's say 25 lakhs, then 1. an explicit approval from the investor will be required. Three points are clearly defined in this clause. How will the funds be utilized? Approval mechanism for material change in fund utilization and spending beyond defined threshold and third, tracking process for funding utilization. Exit clause. The next clause which is possibly the most important from the investor's perspective is exit clause. Why do investors invest in a business? Simple no-brainer answer to this is for a profitable return and that will happen only if an investor is able to exit.


Uses of fund clause. Moving on to the next clause, which is uses of funds. This clause defines how the company will utilize the investment amount. When you present the business plan to the investors, you also share the details of your funding utilization. The business plan gets approved by the investor and so does the utilization of the investment proceeds. The founders have to stick to the utilization plan. In case there is any material deviation, say 10%, the founders have to go back to the investors and take an approval. To track the utilization, investor money is parked in a new bank account and no revenue is booked in that account. Also, there are certain restrictions. In case the company wants to spend more than the defined threshold amount in one go, let's say 25 lakhs, then 1. an explicit approval from the investor will be required. Three points are clearly defined in this clause. How will the funds be utilized? Approval mechanism for material change in fund utilization and spending beyond defined threshold and third, tracking process for funding utilization. Exit clause. The next clause which is possibly the most important from the investor's perspective is exit clause. Why do investors invest in a business? Simple no-brainer answer to this is for a profitable return and that will happen only if an investor is able to exit. Founders need to provide an exit to the investors at the end of five years through either an IPO or a secondary sale or an acquisition. At times, the minimum return expected by the investor is also clearly stated.


Exit clause. The next clause which is possibly the most important from the investor's perspective is exit clause. Why do investors invest in a business? Simple no-brainer answer to this is for a profitable return and that will happen only if an investor is able to exit. Founders need to provide an exit to the investors at the end of five years through either an IPO or a secondary sale or an acquisition. At times, the minimum return expected by the investor is also clearly stated. Now, what happens if the founders cannot provide an exit to the investor? The investor will now go out in the market and start looking for a potential buyer. The investor comes across a buyer who's willing to buy 51% stake in the business. But the investor holds only a 10% stake in the company. In this situation, the investor can drag the founder along with him to sell the founder's 41% so that they can create a block of 51% to be sold to the interested buyer. This clause is known as the drag-along clause. While this clause will always be a part of the term sheet for a sizable investor, you can negotiate on a fall-away threshold for drag.


Founders need to provide an exit to the investors at the end of five years through either an IPO or a secondary sale or an acquisition. At times, the minimum return expected by the investor is also clearly stated. Now, what happens if the founders cannot provide an exit to the investor? The investor will now go out in the market and start looking for a potential buyer. The investor comes across a buyer who's willing to buy 51% stake in the business. But the investor holds only a 10% stake in the company. In this situation, the investor can drag the founder along with him to sell the founder's 41% so that they can create a block of 51% to be sold to the interested buyer. This clause is known as the drag-along clause. While this clause will always be a part of the term sheet for a sizable investor, you can negotiate on a fall-away threshold for drag. While this clause will always be a part of the term sheet for a sizable investor, you can negotiate a fall-away threshold on drag, which means if the investor's shareholding goes below 10%, then the drag clause falls off. Also, try and negotiate for a cap, which means instead of a full drag of up to 100%, negotiate for a cap dragged up to 49%. Now, what if even the investor has not been able to find a buyer? In this case, the buyback option gets triggered. This means the company or the founder should buy back the shares from the investor. At times, there is an obligation on the company or the founder to buy and they don't have a choice but to buy. This is called a put option.


Now, what happens if the founders cannot provide an exit to the investor? The investor will now go out in the market and start looking for a potential buyer. The investor comes across a buyer who's willing to buy 51% stake in the business. But the investor holds only a 10% stake in the company. In this situation, the investor can drag the founder along with him to sell the founder's 41% so that they can create a block of 51% to be sold to the interested buyer. This clause is known as the drag-along clause. While this clause will always be a part of the term sheet for a sizable investor, you can negotiate on a fall-away threshold for drag. While this clause will always be a part of the term sheet for a sizable investor, you can negotiate a fall-away threshold on drag, which means if the investor's shareholding goes below 10%, then the drag clause falls off. Also, try and negotiate for a cap, which means instead of a full drag of up to 100%, negotiate for a cap dragged up to 49%. Now, what if even the investor has not been able to find a buyer? In this case, the buyback option gets triggered. This means the company or the founder should buy back the shares from the investor. At times, there is an obligation on the company or the founder to buy and they don't have a choice but to buy. This is called a put option. What we studied is the waterfall model of exit. If one exit option does not work, the other option is explored and so on. At the end, if nothing works, the investors technically have to write off their investments. Always remember, as a founder, you should be clear about one thing. Is there any clause that is forcing you to provide an exit to the investor? By using your personal funds, then you should put your foot down because you don't want to take any personal liability. Ring fence your personal assets. This should be your topmost priority and this is much more important than valuation, the funding amount that you are looking to raise, etc.


While this clause will always be a part of the term sheet for a sizable investor, you can negotiate a fall-away threshold on drag, which means if the investor's shareholding goes below 10%, then the drag clause falls off. Also, try and negotiate for a cap, which means instead of a full drag of up to 100%, negotiate for a cap dragged up to 49%. Now, what if even the investor has not been able to find a buyer? In this case, the buyback option gets triggered. This means the company or the founder should buy back the shares from the investor. At times, there is an obligation on the company or the founder to buy and they don't have a choice but to buy. This is called a put option. What we studied is the waterfall model of exit. If one exit option does not work, the other option is explored and so on. At the end, if nothing works, the investors technically have to write off their investments. Always remember, as a founder, you should be clear about one thing. Is there any clause that is forcing you to provide an exit to the investor? By using your personal funds, then you should put your foot down because you don't want to take any personal liability. Ring fence your personal assets. This should be your topmost priority and this is much more important than valuation, the funding amount that you are looking to raise, etc. pre-emptive right. Next on the clause list is pre-emptive right. This right is given to the investor to participate in future rounds of funding in proportion to the shareholding.


What we studied is the waterfall model of exit. If one exit option does not work, the other option is explored and so on. At the end, if nothing works, the investors technically have to write off their investments. Always remember, as a founder, you should be clear about one thing. Is there any clause that is forcing you to provide an exit to the investor? By using your personal funds, then you should put your foot down because you don't want to take any personal liability. Ring fence your personal assets. This should be your topmost priority and this is much more important than valuation, the funding amount that you are looking to raise, etc. pre-emptive right. Next on the clause list is pre-emptive right. This right is given to the investor to participate in future rounds of funding in proportion to the shareholding. So let's say an angel investor has a 10% stake in the company. This company raises a series A round of 10 crores. Now this angel investor has the right to participate in this series A round and subscribe to shares worth 1 crore. So if an investor is holding 10% stake in the company and goes for the next round of funding of 10 crores, then the existing investor holding a 10% stake has the right to participate in the round and subscribe to shares worth 1 crore. Of course, this is not an obligation on the investor but just a right that the investor can exercise. This right has no downside impact on the company or the founder and hence no negotiation is required on preemptive right.


pre-emptive right. Next on the clause list is pre-emptive right. This right is given to the investor to participate in future rounds of funding in proportion to the shareholding. So let's say an angel investor has a 10% stake in the company. This company raises a series A round of 10 crores. Now this angel investor has the right to participate in this series A round and subscribe to shares worth 1 crore. So if an investor is holding 10% stake in the company and goes for the next round of funding of 10 crores, then the existing investor holding a 10% stake has the right to participate in the round and subscribe to shares worth 1 crore. Of course, this is not an obligation on the investor but just a right that the investor can exercise. This right has no downside impact on the company or the founder and hence no negotiation is required on preemptive right. Liquidation preference clause. The next clause that we will look at in detail is the liquidation preference clause. Investors subscribe to preference shares. Preference shares, as the name suggests, have the first preference over money received from the liquidity event. Founders who hold common shares are entitled to receive any amount of liquidation proceeds after the preference shareholders.


So let's say an angel investor has a 10% stake in the company. This company raises a series A round of 10 crores. Now this angel investor has the right to participate in this series A round and subscribe to shares worth 1 crore. So if an investor is holding 10% stake in the company and goes for the next round of funding of 10 crores, then the existing investor holding a 10% stake has the right to participate in the round and subscribe to shares worth 1 crore. Of course, this is not an obligation on the investor but just a right that the investor can exercise. This right has no downside impact on the company or the founder and hence no negotiation is required on preemptive right. Liquidation preference clause. The next clause that we will look at in detail is the liquidation preference clause. Investors subscribe to preference shares. Preference shares, as the name suggests, have the first preference over money received from the liquidity event. Founders who hold common shares are entitled to receive any amount of liquidation proceeds after the preference shareholders. The whole objective of this clause is to protect the capital. The liquidation event does not only include winding up or bankruptcy, but also includes events such as acquisitions. So both bad and good events are a part of the definition of liquidity event.


Liquidation preference clause. The next clause that we will look at in detail is the liquidation preference clause. Investors subscribe to preference shares. Preference shares, as the name suggests, have the first preference over money received from the liquidity event. Founders who hold common shares are entitled to receive any amount of liquidation proceeds after the preference shareholders. The whole objective of this clause is to protect the capital. The liquidation event does not only include winding up or bankruptcy, but also includes events such as acquisitions. So both bad and good events are a part of the definition of liquidity event. The liquidation event does not only include winding up or bankruptcy, but also some of the other events. Liquidation preference has two parts, the preference and the participation. Preference basically includes investors getting 1x of their capital back.


The whole objective of this clause is to protect the capital. The liquidation event does not only include winding up or bankruptcy, but also includes events such as acquisitions. So both bad and good events are a part of the definition of liquidity event. The liquidation event does not only include winding up or bankruptcy, but also some of the other events. Liquidation preference has two parts, the preference and the participation. Preference basically includes investors getting 1x of their capital back. The second part includes pro-rata participation in the remaining liquidation proceeds. Let us understand this clause with the help of an illustration.


The liquidation event does not only include winding up or bankruptcy, but also some of the other events. Liquidation preference has two parts, the preference and the participation. Preference basically includes investors getting 1x of their capital back. The second part includes pro-rata participation in the remaining liquidation proceeds. Let us understand this clause with the help of an illustration. An investor has invested 5 crores in a venture against a 30% stake. 5 years later, the company gets acquired for 50 crores. Now, how will this 50 crores, which we call as the liquidation proceeds, get divided between the investors and the founder?


The second part includes pro-rata participation in the remaining liquidation proceeds. Let us understand this clause with the help of an illustration. An investor has invested 5 crores in a venture against a 30% stake. 5 years later, the company gets acquired for 50 crores. Now, how will this 50 crores, which we call as the liquidation proceeds, get divided between the investors and the founder? Investor will first take out 1x of the investment amount, which is 5 crores. Now, the remaining proceeds are 50 crores minus 5 crores, which is 45 crores. From this 45 crores, investor will take a pro-rata share, which is 30%. So, 30% of 45 crores is 13.5 crores. The total amount that the investor will take will be 5 crores plus 13.5 crores, which is 18.5 crores. The founder, on the other hand, will take the remaining amount, which is 50 crores minus 18.5 crores. Founder's share will be 31.5 crores. This is how liquidation preference clause works.


An investor has invested 5 crores in a venture against a 30% stake. 5 years later, the company gets acquired for 50 crores. Now, how will this 50 crores, which we call as the liquidation proceeds, get divided between the investors and the founder? Investor will first take out 1x of the investment amount, which is 5 crores. Now, the remaining proceeds are 50 crores minus 5 crores, which is 45 crores. From this 45 crores, investor will take a pro-rata share, which is 30%. So, 30% of 45 crores is 13.5 crores. The total amount that the investor will take will be 5 crores plus 13.5 crores, which is 18.5 crores. The founder, on the other hand, will take the remaining amount, which is 50 crores minus 18.5 crores. Founder's share will be 31.5 crores. This is how liquidation preference clause works. right of first refusal and tag-along right. The next set of clauses are right of first refusal or ROFR and the tag-along right.


Investor will first take out 1x of the investment amount, which is 5 crores. Now, the remaining proceeds are 50 crores minus 5 crores, which is 45 crores. From this 45 crores, investor will take a pro-rata share, which is 30%. So, 30% of 45 crores is 13.5 crores. The total amount that the investor will take will be 5 crores plus 13.5 crores, which is 18.5 crores. The founder, on the other hand, will take the remaining amount, which is 50 crores minus 18.5 crores. Founder's share will be 31.5 crores. This is how liquidation preference clause works. right of first refusal and tag-along right. The next set of clauses are right of first refusal or ROFR and the tag-along right. Rofer is a very simple clause that suggests if the founder wants to sell his personal shareholding, then he should first come to the investor and offer it. Only if the investor refuses, the founder can go out and find a buyer. Now, in case the founder finds a buyer for his shares, the investor tags along, which means for every one share that the founder is selling, an investor's one share has to be also sold. Tag along, right, is to ensure that the founders don't sell out, leaving behind the investors in the company with new shareholding. However, what if the founders have to sell shares due to some emergency or to capture some value by liquidating a part of their stock? In this case, always remember to carve out a small shareholding, say 5%, on which the tag along clause will not kick in.


right of first refusal and tag-along right. The next set of clauses are right of first refusal or ROFR and the tag-along right. Rofer is a very simple clause that suggests if the founder wants to sell his personal shareholding, then he should first come to the investor and offer it. Only if the investor refuses, the founder can go out and find a buyer. Now, in case the founder finds a buyer for his shares, the investor tags along, which means for every one share that the founder is selling, an investor's one share has to be also sold. Tag along, right, is to ensure that the founders don't sell out, leaving behind the investors in the company with new shareholding. However, what if the founders have to sell shares due to some emergency or to capture some value by liquidating a part of their stock? In this case, always remember to carve out a small shareholding, say 5%, on which the tag along clause will not kick in. When founders decide to sell beyond this threshold, tag along would kick in automatically.


Rofer is a very simple clause that suggests if the founder wants to sell his personal shareholding, then he should first come to the investor and offer it. Only if the investor refuses, the founder can go out and find a buyer. Now, in case the founder finds a buyer for his shares, the investor tags along, which means for every one share that the founder is selling, an investor's one share has to be also sold. Tag along, right, is to ensure that the founders don't sell out, leaving behind the investors in the company with new shareholding. However, what if the founders have to sell shares due to some emergency or to capture some value by liquidating a part of their stock? In this case, always remember to carve out a small shareholding, say 5%, on which the tag along clause will not kick in. When founders decide to sell beyond this threshold, tag along would kick in automatically. Board Seat and Reserved Matter Clause Let us now talk a bit about board composition. Investors typically take a board seat post-investment. Company is governed by the board and the key decisions on the way forward are taken by the board. Board decisions are based on majority. To have a control over board decisions that are material to investors, reserved matter clause becomes an integral part of the term sheet. This clause gives the investor director a veto over certain defined decisions which means when it comes to certain decisions, investor approval is a must.


When founders decide to sell beyond this threshold, tag along would kick in automatically. Board Seat and Reserved Matter Clause Let us now talk a bit about board composition. Investors typically take a board seat post-investment. Company is governed by the board and the key decisions on the way forward are taken by the board. Board decisions are based on majority. To have a control over board decisions that are material to investors, reserved matter clause becomes an integral part of the term sheet. This clause gives the investor director a veto over certain defined decisions which means when it comes to certain decisions, investor approval is a must. Sample list of reserved matter is on your screen. Detailed list is available in the template section. The list varies depending on the investment amount and the shareholding of the investor. Investors with small shareholding obviously do not get a long list of reserved matter items.


Board Seat and Reserved Matter Clause Let us now talk a bit about board composition. Investors typically take a board seat post-investment. Company is governed by the board and the key decisions on the way forward are taken by the board. Board decisions are based on majority. To have a control over board decisions that are material to investors, reserved matter clause becomes an integral part of the term sheet. This clause gives the investor director a veto over certain defined decisions which means when it comes to certain decisions, investor approval is a must. Sample list of reserved matter is on your screen. Detailed list is available in the template section. The list varies depending on the investment amount and the shareholding of the investor. Investors with small shareholding obviously do not get a long list of reserved matter items. Even in this case, you can decide a fall-away threshold. So, as the shareholding falls below a certain minimum threshold, the investor does not get veto right or there is a smaller list of reserved matters.


Sample list of reserved matter is on your screen. Detailed list is available in the template section. The list varies depending on the investment amount and the shareholding of the investor. Investors with small shareholding obviously do not get a long list of reserved matter items. Even in this case, you can decide a fall-away threshold. So, as the shareholding falls below a certain minimum threshold, the investor does not get veto right or there is a smaller list of reserved matters. Finally, last few clauses. Investors expect the founders to be employed with the company till they exit. Also, founders are restricted from starting or investing in a similar company or a competing business.


Even in this case, you can decide a fall-away threshold. So, as the shareholding falls below a certain minimum threshold, the investor does not get veto right or there is a smaller list of reserved matters. Finally, last few clauses. Investors expect the founders to be employed with the company till they exit. Also, founders are restricted from starting or investing in a similar company or a competing business. Post signing the term sheet, the exclusivity clause kicks in. This is in good faith. As per this clause, the investor expects the founder to stop all conversations with all other investors and work on closing this particular round. Negotiations with investors on various clauses can go on and on. To work on tight timelines towards closure, the term sheet is typically valid for 30 days. So, all the negotiations should happen within the 30-day time frame. Also, once the term sheet is signed, the founders and the investor agree to close the round within 90 days. All these clauses that we studied are negotiated and finalized and then the term sheet is signed by both parties. However, as stated earlier, signing the term sheet does not mean that the deal is done. The term sheet gets expanded into a legally binding SHA drafted by the lawyers. The deal is done only when the SHA gets signed.


Finally, last few clauses. Investors expect the founders to be employed with the company till they exit. Also, founders are restricted from starting or investing in a similar company or a competing business. Post signing the term sheet, the exclusivity clause kicks in. This is in good faith. As per this clause, the investor expects the founder to stop all conversations with all other investors and work on closing this particular round. Negotiations with investors on various clauses can go on and on. To work on tight timelines towards closure, the term sheet is typically valid for 30 days. So, all the negotiations should happen within the 30-day time frame. Also, once the term sheet is signed, the founders and the investor agree to close the round within 90 days. All these clauses that we studied are negotiated and finalized and then the term sheet is signed by both parties. However, as stated earlier, signing the term sheet does not mean that the deal is done. The term sheet gets expanded into a legally binding SHA drafted by the lawyers. The deal is done only when the SHA gets signed. We are now slowly moving towards the ending of our fundraise movie. We are super excited with the fact that we have just signed a term sheet with the investor and we know the money is on the way. But like every movie, even here there is a small twist.


Post signing the term sheet, the exclusivity clause kicks in. This is in good faith. As per this clause, the investor expects the founder to stop all conversations with all other investors and work on closing this particular round. Negotiations with investors on various clauses can go on and on. To work on tight timelines towards closure, the term sheet is typically valid for 30 days. So, all the negotiations should happen within the 30-day time frame. Also, once the term sheet is signed, the founders and the investor agree to close the round within 90 days. All these clauses that we studied are negotiated and finalized and then the term sheet is signed by both parties. However, as stated earlier, signing the term sheet does not mean that the deal is done. The term sheet gets expanded into a legally binding SHA drafted by the lawyers. The deal is done only when the SHA gets signed. We are now slowly moving towards the ending of our fundraise movie. We are super excited with the fact that we have just signed a term sheet with the investor and we know the money is on the way. But like every movie, even here there is a small twist. After signing the term sheet and before executing the shareholder's agreement, there is a crucial step and this step is a tricky one. I'm not trying to scare you here. I'm just saying this is a step which can make or break your deal. You need to be prepared to clear this hurdle called due diligence. In this session, we are going to focus on how to steer through the due diligence process. We will start by understanding what exactly is due diligence. We will then go through details of what do investors look for during DD. Finally, we will go through the step-by-step process to prepare for due diligence. Let's get started.


We are now slowly moving towards the ending of our fundraise movie. We are super excited with the fact that we have just signed a term sheet with the investor and we know the money is on the way. But like every movie, even here there is a small twist. After signing the term sheet and before executing the shareholder's agreement, there is a crucial step and this step is a tricky one. I'm not trying to scare you here. I'm just saying this is a step which can make or break your deal. You need to be prepared to clear this hurdle called due diligence. In this session, we are going to focus on how to steer through the due diligence process. We will start by understanding what exactly is due diligence. We will then go through details of what do investors look for during DD. Finally, we will go through the step-by-step process to prepare for due diligence. Let's get started. DD is initiated post signing the term sheet. Depending on the stage of the investment, the process can go for up to six weeks.


After signing the term sheet and before executing the shareholder's agreement, there is a crucial step and this step is a tricky one. I'm not trying to scare you here. I'm just saying this is a step which can make or break your deal. You need to be prepared to clear this hurdle called due diligence. In this session, we are going to focus on how to steer through the due diligence process. We will start by understanding what exactly is due diligence. We will then go through details of what do investors look for during DD. Finally, we will go through the step-by-step process to prepare for due diligence. Let's get started. DD is initiated post signing the term sheet. Depending on the stage of the investment, the process can go for up to six weeks. All of it actually depends on how well the company is prepared for the due diligence exercise. The output of DD is a list of red flags. In case where there is a fraud in the company or there is a potential of a huge liability arising, then the investor calls off the transaction. In case of non-critical findings, a list of conditions are included in the shareholder's agreement that the company must fulfill.


DD is initiated post signing the term sheet. Depending on the stage of the investment, the process can go for up to six weeks. All of it actually depends on how well the company is prepared for the due diligence exercise. The output of DD is a list of red flags. In case where there is a fraud in the company or there is a potential of a huge liability arising, then the investor calls off the transaction. In case of non-critical findings, a list of conditions are included in the shareholder's agreement that the company must fulfill. These conditions are corrective steps. CPs are a list of action points that the company must do before the money is transferred. CS includes a list of action items that need to be completed 30-45 days after the money is in the bank. Generally, Angel Stage DD is not at all exhaustive, like the Series A. The company has very little data to share during the Angel Round, but by Series A, the company has clients, employees, operating history, and this is where DD starts becoming quite intensive. Use the Fund-Enabled DD Checklist and follow three steps to prepare for due diligence. Remember, your objective should be to become due diligence ready.


All of it actually depends on how well the company is prepared for the due diligence exercise. The output of DD is a list of red flags. In case where there is a fraud in the company or there is a potential of a huge liability arising, then the investor calls off the transaction. In case of non-critical findings, a list of conditions are included in the shareholder's agreement that the company must fulfill. These conditions are corrective steps. CPs are a list of action points that the company must do before the money is transferred. CS includes a list of action items that need to be completed 30-45 days after the money is in the bank. Generally, Angel Stage DD is not at all exhaustive, like the Series A. The company has very little data to share during the Angel Round, but by Series A, the company has clients, employees, operating history, and this is where DD starts becoming quite intensive. Use the Fund-Enabled DD Checklist and follow three steps to prepare for due diligence. Remember, your objective should be to become due diligence ready. Let's start by understanding what exactly is due diligence and where there is a need for doing due diligence.


These conditions are corrective steps. CPs are a list of action points that the company must do before the money is transferred. CS includes a list of action items that need to be completed 30-45 days after the money is in the bank. Generally, Angel Stage DD is not at all exhaustive, like the Series A. The company has very little data to share during the Angel Round, but by Series A, the company has clients, employees, operating history, and this is where DD starts becoming quite intensive. Use the Fund-Enabled DD Checklist and follow three steps to prepare for due diligence. Remember, your objective should be to become due diligence ready. Let's start by understanding what exactly is due diligence and where there is a need for doing due diligence. By now, the investor is convinced with investing in your venture and has already signed a term sheet. But what about evaluating a deal from legal and compliance perspective? Due diligence is evaluation of the company from a legal and compliance lens. And why is this important? Non-compliance, mistakes and no documentation can lead to hidden liabilities. For example, if provident fund related compliance is applicable on your company and you haven't done it, then it can lead to penalties and liabilities. One objective of the due diligence exercise is also to verify the facts mentioned during pitching and investor evaluation process. Details about revenue, cost, margin, customers, etc. are verified. The ultimate goal of this exercise is to figure out how to evaluate a deal from a legal and compliance perspective. Is this a good deal or a costly mistake? DD is undertaken by an investor-appointed law firm and an accounting firm. So what all is checked? The exercise looks into four major risk areas. Compliance, legal, finance, HR and intellectual property. Let's go through each of these items one by one.


Let's start by understanding what exactly is due diligence and where there is a need for doing due diligence. By now, the investor is convinced with investing in your venture and has already signed a term sheet. But what about evaluating a deal from legal and compliance perspective? Due diligence is evaluation of the company from a legal and compliance lens. And why is this important? Non-compliance, mistakes and no documentation can lead to hidden liabilities. For example, if provident fund related compliance is applicable on your company and you haven't done it, then it can lead to penalties and liabilities. One objective of the due diligence exercise is also to verify the facts mentioned during pitching and investor evaluation process. Details about revenue, cost, margin, customers, etc. are verified. The ultimate goal of this exercise is to figure out how to evaluate a deal from a legal and compliance perspective. Is this a good deal or a costly mistake? DD is undertaken by an investor-appointed law firm and an accounting firm. So what all is checked? The exercise looks into four major risk areas. Compliance, legal, finance, HR and intellectual property. Let's go through each of these items one by one. There are several rules, regulations and filings related to the Ministry of Corporate Affairs that a private limited company has to comply with. All such relevant compliances or related filings are checked. On the finance front, your historical financials, analysis of revenue streams, costs, receivables, payables is done. Also, relevant payments and filings related to direct and indirect taxes are checked minutely. On the HR front, the list of key employees, their salaries, bonuses, ESOP promises and letters, all of this is thoroughly analyzed.


By now, the investor is convinced with investing in your venture and has already signed a term sheet. But what about evaluating a deal from legal and compliance perspective? Due diligence is evaluation of the company from a legal and compliance lens. And why is this important? Non-compliance, mistakes and no documentation can lead to hidden liabilities. For example, if provident fund related compliance is applicable on your company and you haven't done it, then it can lead to penalties and liabilities. One objective of the due diligence exercise is also to verify the facts mentioned during pitching and investor evaluation process. Details about revenue, cost, margin, customers, etc. are verified. The ultimate goal of this exercise is to figure out how to evaluate a deal from a legal and compliance perspective. Is this a good deal or a costly mistake? DD is undertaken by an investor-appointed law firm and an accounting firm. So what all is checked? The exercise looks into four major risk areas. Compliance, legal, finance, HR and intellectual property. Let's go through each of these items one by one. There are several rules, regulations and filings related to the Ministry of Corporate Affairs that a private limited company has to comply with. All such relevant compliances or related filings are checked. On the finance front, your historical financials, analysis of revenue streams, costs, receivables, payables is done. Also, relevant payments and filings related to direct and indirect taxes are checked minutely. On the HR front, the list of key employees, their salaries, bonuses, ESOP promises and letters, all of this is thoroughly analyzed. Typically, in an early stage company, an employee is hired by just sending an email confirmation or over a phone call. What is expected is an employment contract with clauses such as non-compete, confidentiality, termination clause, intellectual property rights, etc. In the due diligence exercise, employee contracts are checked. If you don't have any contract, then the DD agency will suggest you get it drafted and executed.


There are several rules, regulations and filings related to the Ministry of Corporate Affairs that a private limited company has to comply with. All such relevant compliances or related filings are checked. On the finance front, your historical financials, analysis of revenue streams, costs, receivables, payables is done. Also, relevant payments and filings related to direct and indirect taxes are checked minutely. On the HR front, the list of key employees, their salaries, bonuses, ESOP promises and letters, all of this is thoroughly analyzed. Typically, in an early stage company, an employee is hired by just sending an email confirmation or over a phone call. What is expected is an employment contract with clauses such as non-compete, confidentiality, termination clause, intellectual property rights, etc. In the due diligence exercise, employee contracts are checked. If you don't have any contract, then the DD agency will suggest you get it drafted and executed. In the DD exercise, employee contracts are checked. If you don't have any contract, then the DD agency will suggest you get it drafted and executed. Every business has some intellectual property. For tech business, it is the code. For product company, it is the design. For pharma, it is the formulation.


Typically, in an early stage company, an employee is hired by just sending an email confirmation or over a phone call. What is expected is an employment contract with clauses such as non-compete, confidentiality, termination clause, intellectual property rights, etc. In the due diligence exercise, employee contracts are checked. If you don't have any contract, then the DD agency will suggest you get it drafted and executed. In the DD exercise, employee contracts are checked. If you don't have any contract, then the DD agency will suggest you get it drafted and executed. Every business has some intellectual property. For tech business, it is the code. For product company, it is the design. For pharma, it is the formulation. Besides this, the company has its brand name and URL which defines the identity of the business. Due diligence exercise looks at relevant filings to confirm that the ownership of the intellectual property resides within the company and not otherwise. No employee, third party, vendor or for that matter, even the founder can claim the ownership of it.


In the DD exercise, employee contracts are checked. If you don't have any contract, then the DD agency will suggest you get it drafted and executed. Every business has some intellectual property. For tech business, it is the code. For product company, it is the design. For pharma, it is the formulation. Besides this, the company has its brand name and URL which defines the identity of the business. Due diligence exercise looks at relevant filings to confirm that the ownership of the intellectual property resides within the company and not otherwise. No employee, third party, vendor or for that matter, even the founder can claim the ownership of it. A simple example of this is when a founder buys a domain name for the business. Typically, it is bought from the platform such as godaddy.com by swiping his or her own credit card. Now the URL is technically bought by the founder and hence the founder is the owner of the company URL. The company URL has to be owned by the company and not the founder. We've briefly gone through what DD is all about and what kind of information is gathered during the process. Now let's look at the most important question. How do we prepare for DD exercise? We have provided a detailed DD checklist so that you can exactly know what information is expected from you during the process. This is like appearing for prelims before going for your final exams. We will go through three simple steps for our DD preparation. Step 1. Step 1 is to create a deal room. Use Dropbox or Google Drive to create folder structure as per the DD checklist. In the checklist, the first point is incorporation certificate. So create folder number 1.


Besides this, the company has its brand name and URL which defines the identity of the business. Due diligence exercise looks at relevant filings to confirm that the ownership of the intellectual property resides within the company and not otherwise. No employee, third party, vendor or for that matter, even the founder can claim the ownership of it. A simple example of this is when a founder buys a domain name for the business. Typically, it is bought from the platform such as godaddy.com by swiping his or her own credit card. Now the URL is technically bought by the founder and hence the founder is the owner of the company URL. The company URL has to be owned by the company and not the founder. We've briefly gone through what DD is all about and what kind of information is gathered during the process. Now let's look at the most important question. How do we prepare for DD exercise? We have provided a detailed DD checklist so that you can exactly know what information is expected from you during the process. This is like appearing for prelims before going for your final exams. We will go through three simple steps for our DD preparation. Step 1. Step 1 is to create a deal room. Use Dropbox or Google Drive to create folder structure as per the DD checklist. In the checklist, the first point is incorporation certificate. So create folder number 1. Step 2. In this folder number 1, start uploading all your documents relevant to company incorporation such as incorporation certificate. Step 3 is to repeat this exercise for all the points in the checklist. Also, update the status of the checklist. You might not always have the documents in place and hence we can work on it and come back. By updating the status against each point, you will come to know where are you currently standing.


A simple example of this is when a founder buys a domain name for the business. Typically, it is bought from the platform such as godaddy.com by swiping his or her own credit card. Now the URL is technically bought by the founder and hence the founder is the owner of the company URL. The company URL has to be owned by the company and not the founder. We've briefly gone through what DD is all about and what kind of information is gathered during the process. Now let's look at the most important question. How do we prepare for DD exercise? We have provided a detailed DD checklist so that you can exactly know what information is expected from you during the process. This is like appearing for prelims before going for your final exams. We will go through three simple steps for our DD preparation. Step 1. Step 1 is to create a deal room. Use Dropbox or Google Drive to create folder structure as per the DD checklist. In the checklist, the first point is incorporation certificate. So create folder number 1. Step 2. In this folder number 1, start uploading all your documents relevant to company incorporation such as incorporation certificate. Step 3 is to repeat this exercise for all the points in the checklist. Also, update the status of the checklist. You might not always have the documents in place and hence we can work on it and come back. By updating the status against each point, you will come to know where are you currently standing. It is okay if you don't have a particular item. Don't hide it from the investor. They will eventually find it out. The key in any relationship is transparency, and the investor-founder relationship is no different. Remember, most entrepreneurs take the DD process lightly. The savvy ones who have raised multiple rounds mark this as the most important step in the entire fundraising process. This is make or break. So you have two options. One, wait for the term sheet signing stage. As soon as it is done, you will be handed over the first DD checklist. Get overwhelmed, start running around, and delay the entire process. Or, take the DD checklist and start today. The idea is to be DD ready even before going to the investors.


Step 2. In this folder number 1, start uploading all your documents relevant to company incorporation such as incorporation certificate. Step 3 is to repeat this exercise for all the points in the checklist. Also, update the status of the checklist. You might not always have the documents in place and hence we can work on it and come back. By updating the status against each point, you will come to know where are you currently standing. It is okay if you don't have a particular item. Don't hide it from the investor. They will eventually find it out. The key in any relationship is transparency, and the investor-founder relationship is no different. Remember, most entrepreneurs take the DD process lightly. The savvy ones who have raised multiple rounds mark this as the most important step in the entire fundraising process. This is make or break. So you have two options. One, wait for the term sheet signing stage. As soon as it is done, you will be handed over the first DD checklist. Get overwhelmed, start running around, and delay the entire process. Or, take the DD checklist and start today. The idea is to be DD ready even before going to the investors. Due diligence, as we've just seen, evaluates a deal from legal, compliance, and financial perspective. The exercise is all about finding hidden skeletons. This might create huge liabilities for the company in future. The investor expects the capital to go towards expansion and not towards settling off liabilities due to non-compliance. The outcome of this exercise is a list of red flags. If the red flags are extremely critical, such as fraud by the founders, then the deal gets called off. If the findings are minor, then the company is given time to take corrective actions. Generally, angel stage DD is not as exhaustive as series ADD. This is because in the early stages, the company has very little chance. But by series A, the company has clients, employees, operating history, etc. Which makes the DD process very intensive. We hope this course helps you prepare for DD process and tackle it successfully. Thank you.


It is okay if you don't have a particular item. Don't hide it from the investor. They will eventually find it out. The key in any relationship is transparency, and the investor-founder relationship is no different. Remember, most entrepreneurs take the DD process lightly. The savvy ones who have raised multiple rounds mark this as the most important step in the entire fundraising process. This is make or break. So you have two options. One, wait for the term sheet signing stage. As soon as it is done, you will be handed over the first DD checklist. Get overwhelmed, start running around, and delay the entire process. Or, take the DD checklist and start today. The idea is to be DD ready even before going to the investors. Due diligence, as we've just seen, evaluates a deal from legal, compliance, and financial perspective. The exercise is all about finding hidden skeletons. This might create huge liabilities for the company in future. The investor expects the capital to go towards expansion and not towards settling off liabilities due to non-compliance. The outcome of this exercise is a list of red flags. If the red flags are extremely critical, such as fraud by the founders, then the deal gets called off. If the findings are minor, then the company is given time to take corrective actions. Generally, angel stage DD is not as exhaustive as series ADD. This is because in the early stages, the company has very little chance. But by series A, the company has clients, employees, operating history, etc. Which makes the DD process very intensive. We hope this course helps you prepare for DD process and tackle it successfully. Thank you. Hi, welcome to FundEnable's course on creating a pitch deck. Pitch decks have become synonymous with fundraising. After getting that sought-after meeting with a prospective investor, your pitch defines if you get the next meeting or get shown to the door.


Due diligence, as we've just seen, evaluates a deal from legal, compliance, and financial perspective. The exercise is all about finding hidden skeletons. This might create huge liabilities for the company in future. The investor expects the capital to go towards expansion and not towards settling off liabilities due to non-compliance. The outcome of this exercise is a list of red flags. If the red flags are extremely critical, such as fraud by the founders, then the deal gets called off. If the findings are minor, then the company is given time to take corrective actions. Generally, angel stage DD is not as exhaustive as series ADD. This is because in the early stages, the company has very little chance. But by series A, the company has clients, employees, operating history, etc. Which makes the DD process very intensive. We hope this course helps you prepare for DD process and tackle it successfully. Thank you. Hi, welcome to FundEnable's course on creating a pitch deck. Pitch decks have become synonymous with fundraising. After getting that sought-after meeting with a prospective investor, your pitch defines if you get the next meeting or get shown to the door. There is so much material related to pitch decks on internet today. You can get templates for almost all types and sectors of businesses. But let me tell you, there is no cookie cutter approach to creating pitch decks.


Hi, welcome to FundEnable's course on creating a pitch deck. Pitch decks have become synonymous with fundraising. After getting that sought-after meeting with a prospective investor, your pitch defines if you get the next meeting or get shown to the door. There is so much material related to pitch decks on internet today. You can get templates for almost all types and sectors of businesses. But let me tell you, there is no cookie cutter approach to creating pitch decks. Every pitch deck should include the problem, target market, solution, competition and so on. The trick is to weave these elements into a compelling narrative rather than just a sequence of slides giving loads of information. Through this course, we are going to share with you our recipe of creating an impactful pitch deck. So let us begin.


There is so much material related to pitch decks on internet today. You can get templates for almost all types and sectors of businesses. But let me tell you, there is no cookie cutter approach to creating pitch decks. Every pitch deck should include the problem, target market, solution, competition and so on. The trick is to weave these elements into a compelling narrative rather than just a sequence of slides giving loads of information. Through this course, we are going to share with you our recipe of creating an impactful pitch deck. So let us begin. Now that we've built a pitch deck together, we would like to warm you against some common pitfalls. First, don't talk product, talk business. Entrepreneurs tend to put all their products and related features in the deck. Remember, you are not selling a product to a customer. You are trying to get investments into your business. Second, don't include detailed financials or valuations in the pitch deck. These are the agenda for your next meetings with an investor after you have secured their interest. Third, entrepreneurs often take the same pitch deck to different investors. It is a good practice to study a prospective investor. These investment theses and their portfolio companies give you a very good understanding of what an investor looks like. For example, if you are meeting with an impact fund, do not include a slide on how your business is creating a measurable social impact.


Every pitch deck should include the problem, target market, solution, competition and so on. The trick is to weave these elements into a compelling narrative rather than just a sequence of slides giving loads of information. Through this course, we are going to share with you our recipe of creating an impactful pitch deck. So let us begin. Now that we've built a pitch deck together, we would like to warm you against some common pitfalls. First, don't talk product, talk business. Entrepreneurs tend to put all their products and related features in the deck. Remember, you are not selling a product to a customer. You are trying to get investments into your business. Second, don't include detailed financials or valuations in the pitch deck. These are the agenda for your next meetings with an investor after you have secured their interest. Third, entrepreneurs often take the same pitch deck to different investors. It is a good practice to study a prospective investor. These investment theses and their portfolio companies give you a very good understanding of what an investor looks like. For example, if you are meeting with an impact fund, do not include a slide on how your business is creating a measurable social impact. Last but not the least, if you are pitching for the first time, make sure you prepare a slide-wise script. Most entrepreneurs focus on just creating or designing slides and not so much on what to speak along with the slides. This is why many entrepreneurs fail to create an impression. We hope that we have simplified the process of creating pitch decks for you.


Now that we've built a pitch deck together, we would like to warm you against some common pitfalls. First, don't talk product, talk business. Entrepreneurs tend to put all their products and related features in the deck. Remember, you are not selling a product to a customer. You are trying to get investments into your business. Second, don't include detailed financials or valuations in the pitch deck. These are the agenda for your next meetings with an investor after you have secured their interest. Third, entrepreneurs often take the same pitch deck to different investors. It is a good practice to study a prospective investor. These investment theses and their portfolio companies give you a very good understanding of what an investor looks like. For example, if you are meeting with an impact fund, do not include a slide on how your business is creating a measurable social impact. Last but not the least, if you are pitching for the first time, make sure you prepare a slide-wise script. Most entrepreneurs focus on just creating or designing slides and not so much on what to speak along with the slides. This is why many entrepreneurs fail to create an impression. We hope that we have simplified the process of creating pitch decks for you. Although we have covered a lot of ground in this course, we need to study one component of the pitch deck in greater depth, the financial component. Where do the numbers in the pitch deck come from? Your financial model. In our next course, we will guide you on building your financial model step by step. We look forward to seeing you in our next course. Thank you.


Last but not the least, if you are pitching for the first time, make sure you prepare a slide-wise script. Most entrepreneurs focus on just creating or designing slides and not so much on what to speak along with the slides. This is why many entrepreneurs fail to create an impression. We hope that we have simplified the process of creating pitch decks for you. Although we have covered a lot of ground in this course, we need to study one component of the pitch deck in greater depth, the financial component. Where do the numbers in the pitch deck come from? Your financial model. In our next course, we will guide you on building your financial model step by step. We look forward to seeing you in our next course. Thank you. Hi, welcome to Fund Enable's course on Financing Pathways. The greatest hurdle in raising capital is actually getting an opportunity to meet the right set of investors. Where does one find these investors? Do you reach out to them on LinkedIn? Do you shoot cold emails or apply to widely publicized startup pitching events?


Although we have covered a lot of ground in this course, we need to study one component of the pitch deck in greater depth, the financial component. Where do the numbers in the pitch deck come from? Your financial model. In our next course, we will guide you on building your financial model step by step. We look forward to seeing you in our next course. Thank you. Hi, welcome to Fund Enable's course on Financing Pathways. The greatest hurdle in raising capital is actually getting an opportunity to meet the right set of investors. Where does one find these investors? Do you reach out to them on LinkedIn? Do you shoot cold emails or apply to widely publicized startup pitching events? we have known founders who have sent their pitch decks to a database of hundreds of investors. They've chased investors with this pray-and-pray approach for a long time, but to no avail. Through this course, we will help you tackle the problem of investor access by first, identifying relevant investors, and second, mapping the right way to reach out to the identified investors. At the end of this course, you will be able to come up with a list of investors having the highest probability of investing in your business. So let's get started.


Hi, welcome to Fund Enable's course on Financing Pathways. The greatest hurdle in raising capital is actually getting an opportunity to meet the right set of investors. Where does one find these investors? Do you reach out to them on LinkedIn? Do you shoot cold emails or apply to widely publicized startup pitching events? we have known founders who have sent their pitch decks to a database of hundreds of investors. They've chased investors with this pray-and-pray approach for a long time, but to no avail. Through this course, we will help you tackle the problem of investor access by first, identifying relevant investors, and second, mapping the right way to reach out to the identified investors. At the end of this course, you will be able to come up with a list of investors having the highest probability of investing in your business. So let's get started. We're sure that by now, you've identified the stage of your business and the amount of funding that you need to raise. For simplifying the process of finding investors, refer to Fund Enable Investor Matrix. With this tool, you will be able to identify active investors suitable for your sector and stage. You can visit www.fundenable.com and submit your pitch decks for further support on Investor Connect. Looking forward to seeing you in the next course. Bye.


we have known founders who have sent their pitch decks to a database of hundreds of investors. They've chased investors with this pray-and-pray approach for a long time, but to no avail. Through this course, we will help you tackle the problem of investor access by first, identifying relevant investors, and second, mapping the right way to reach out to the identified investors. At the end of this course, you will be able to come up with a list of investors having the highest probability of investing in your business. So let's get started. We're sure that by now, you've identified the stage of your business and the amount of funding that you need to raise. For simplifying the process of finding investors, refer to Fund Enable Investor Matrix. With this tool, you will be able to identify active investors suitable for your sector and stage. You can visit www.fundenable.com and submit your pitch decks for further support on Investor Connect. Looking forward to seeing you in the next course. Bye. Why do investors invest in a venture? The simple no-brainer answer is returns. But private investments are extremely illiquid. What do we mean by that? If you have bought shares of a publicly traded company, with a click of a button, you can book your profits or your losses. You can easily exit. Whenever you are planning to go and meet an investor, be prepared to answer this. As a founder, you need to be sure about this because the onus of investor exit is on the founder. So what are the different ways in which you can provide an exit to the investor? This course explores various options and strategies to give a profitable exit to the investors.


We're sure that by now, you've identified the stage of your business and the amount of funding that you need to raise. For simplifying the process of finding investors, refer to Fund Enable Investor Matrix. With this tool, you will be able to identify active investors suitable for your sector and stage. You can visit www.fundenable.com and submit your pitch decks for further support on Investor Connect. Looking forward to seeing you in the next course. Bye. Why do investors invest in a venture? The simple no-brainer answer is returns. But private investments are extremely illiquid. What do we mean by that? If you have bought shares of a publicly traded company, with a click of a button, you can book your profits or your losses. You can easily exit. Whenever you are planning to go and meet an investor, be prepared to answer this. As a founder, you need to be sure about this because the onus of investor exit is on the founder. So what are the different ways in which you can provide an exit to the investor? This course explores various options and strategies to give a profitable exit to the investors. most of you might be looking at raising your first round of capital and exit may not even be on your immediate horizon. But exit is the logical conclusion of the capital raising journey, both for you and your investor. This is where the value gets realized. Until then, valuation is just a number on the paper. Even before you enter the capital raising arena, ask this question to yourself. How will I give an exit to my investors?


Why do investors invest in a venture? The simple no-brainer answer is returns. But private investments are extremely illiquid. What do we mean by that? If you have bought shares of a publicly traded company, with a click of a button, you can book your profits or your losses. You can easily exit. Whenever you are planning to go and meet an investor, be prepared to answer this. As a founder, you need to be sure about this because the onus of investor exit is on the founder. So what are the different ways in which you can provide an exit to the investor? This course explores various options and strategies to give a profitable exit to the investors. most of you might be looking at raising your first round of capital and exit may not even be on your immediate horizon. But exit is the logical conclusion of the capital raising journey, both for you and your investor. This is where the value gets realized. Until then, valuation is just a number on the paper. Even before you enter the capital raising arena, ask this question to yourself. How will I give an exit to my investors? Hello, welcome to FundEnable's course on crowdfunding. So far, we've covered a lot of ground when it comes to equity fundraising. In this course, we are going to digress from equity fundraising and explore an alternative funding avenue called crowdfunding. Crowdfunding is rising in popularity in the early stage startup ecosystem.


most of you might be looking at raising your first round of capital and exit may not even be on your immediate horizon. But exit is the logical conclusion of the capital raising journey, both for you and your investor. This is where the value gets realized. Until then, valuation is just a number on the paper. Even before you enter the capital raising arena, ask this question to yourself. How will I give an exit to my investors? Hello, welcome to FundEnable's course on crowdfunding. So far, we've covered a lot of ground when it comes to equity fundraising. In this course, we are going to digress from equity fundraising and explore an alternative funding avenue called crowdfunding. Crowdfunding is rising in popularity in the early stage startup ecosystem. Squareoff, Ricoh are some of the most successful crowdfunding startups in India. These startups have raised upwards of 50 lakh equity-free crowdfunding. Interesting, right? We will explain how these startups managed this feat in this course. We will explain how crowdfunding works and how to set up a crowdfunding campaign step by step. Let's get started.


Hello, welcome to FundEnable's course on crowdfunding. So far, we've covered a lot of ground when it comes to equity fundraising. In this course, we are going to digress from equity fundraising and explore an alternative funding avenue called crowdfunding. Crowdfunding is rising in popularity in the early stage startup ecosystem. Squareoff, Ricoh are some of the most successful crowdfunding startups in India. These startups have raised upwards of 50 lakh equity-free crowdfunding. Interesting, right? We will explain how these startups managed this feat in this course. We will explain how crowdfunding works and how to set up a crowdfunding campaign step by step. Let's get started. We hope this course has given you valuable insights into the crowdfunding process. Let us now look at some of the benefits of crowdfunding that go beyond just raising capital. First and foremost, crowdfunding is a very effective way to validate your idea and build a potential customer base. The backers are your potential customers, and these backers can come from a wide geographical region. On your screen, you can see a news clipping from Squareoff. Crowdfunding success led to Squareoff getting 2,000 pre-orders for their smart chessboard product from 70 different countries.


Squareoff, Ricoh are some of the most successful crowdfunding startups in India. These startups have raised upwards of 50 lakh equity-free crowdfunding. Interesting, right? We will explain how these startups managed this feat in this course. We will explain how crowdfunding works and how to set up a crowdfunding campaign step by step. Let's get started. We hope this course has given you valuable insights into the crowdfunding process. Let us now look at some of the benefits of crowdfunding that go beyond just raising capital. First and foremost, crowdfunding is a very effective way to validate your idea and build a potential customer base. The backers are your potential customers, and these backers can come from a wide geographical region. On your screen, you can see a news clipping from Squareoff. Crowdfunding success led to Squareoff getting 2,000 pre-orders for their smart chessboard product from 70 different countries. The next best advantage of crowdfunding is that it paves the way for angel and venture capital investments. The success of the crowdfunding campaign confirms the market, customer demand, and establishes the fundability of the business.


We hope this course has given you valuable insights into the crowdfunding process. Let us now look at some of the benefits of crowdfunding that go beyond just raising capital. First and foremost, crowdfunding is a very effective way to validate your idea and build a potential customer base. The backers are your potential customers, and these backers can come from a wide geographical region. On your screen, you can see a news clipping from Squareoff. Crowdfunding success led to Squareoff getting 2,000 pre-orders for their smart chessboard product from 70 different countries. The next best advantage of crowdfunding is that it paves the way for angel and venture capital investments. The success of the crowdfunding campaign confirms the market, customer demand, and establishes the fundability of the business. Most of the companies that have been successful at crowdfunding have gone ahead and raised additional rounds of capital from angels and venture capital funds.


The next best advantage of crowdfunding is that it paves the way for angel and venture capital investments. The success of the crowdfunding campaign confirms the market, customer demand, and establishes the fundability of the business. Most of the companies that have been successful at crowdfunding have gone ahead and raised additional rounds of capital from angels and venture capital funds. Even Square Off raised 11.5 crore rupees from K-Start Capital and India Quotient.


Most of the companies that have been successful at crowdfunding have gone ahead and raised additional rounds of capital from angels and venture capital funds. Even Square Off raised 11.5 crore rupees from K-Start Capital and India Quotient. Other advantages of crowdfunding are it increases publicity and media visibility, it attracts talent for your business, and gets your idea for further project innovation.


Even Square Off raised 11.5 crore rupees from K-Start Capital and India Quotient. Other advantages of crowdfunding are it increases publicity and media visibility, it attracts talent for your business, and gets your idea for further project innovation. Now that you understand the nitty-gritty of crowdfunding, you can go ahead and evaluate this new option to raise money for your business. Wishing you all the best. Thank you.


Other advantages of crowdfunding are it increases publicity and media visibility, it attracts talent for your business, and gets your idea for further project innovation. Now that you understand the nitty-gritty of crowdfunding, you can go ahead and evaluate this new option to raise money for your business. Wishing you all the best. Thank you. Hi, welcome to Fund Enable's course on cap tables. In our previous course, we've looked at how to prepare pitch decks and financial models. We have also seen how to identify investors and how to reach out to them. Now it is time to deep dive in the math of actually closing a deal with your investors. In this course, we will start by explaining how dilution works and how shares are issued to investors upon investment.


Now that you understand the nitty-gritty of crowdfunding, you can go ahead and evaluate this new option to raise money for your business. Wishing you all the best. Thank you. Hi, welcome to Fund Enable's course on cap tables. In our previous course, we've looked at how to prepare pitch decks and financial models. We have also seen how to identify investors and how to reach out to them. Now it is time to deep dive in the math of actually closing a deal with your investors. In this course, we will start by explaining how dilution works and how shares are issued to investors upon investment. Hi there. Welcome to Fund Enable's course on Cap Tables. In our previous course, we have looked at how to prepare pitch decks and financial models. We have also seen how to identify investors and how to reach out to them. Now it is time to deep dive into the math of actually closing a deal with your investors. In this course, we will start by explaining how dilution works and how shares are issued to investors upon investments. We will explain this through the means of cap tables. Simply put, cap tables tell us who owns how much of a company at any given point in time. Here is how cap table looks. As you can see, a cap table tells us details such as who owns how much of a company at any given point in time. Who are the shareholders in the company? How much stake they own? And how many shares are issued to them? And what is the value of their shareholding? Without further ado, let's get started on how to build cap tables and why they are important in the process of funding.


Hi, welcome to Fund Enable's course on cap tables. In our previous course, we've looked at how to prepare pitch decks and financial models. We have also seen how to identify investors and how to reach out to them. Now it is time to deep dive in the math of actually closing a deal with your investors. In this course, we will start by explaining how dilution works and how shares are issued to investors upon investment. Hi there. Welcome to Fund Enable's course on Cap Tables. In our previous course, we have looked at how to prepare pitch decks and financial models. We have also seen how to identify investors and how to reach out to them. Now it is time to deep dive into the math of actually closing a deal with your investors. In this course, we will start by explaining how dilution works and how shares are issued to investors upon investments. We will explain this through the means of cap tables. Simply put, cap tables tell us who owns how much of a company at any given point in time. Here is how cap table looks. As you can see, a cap table tells us details such as who owns how much of a company at any given point in time. Who are the shareholders in the company? How much stake they own? And how many shares are issued to them? And what is the value of their shareholding? Without further ado, let's get started on how to build cap tables and why they are important in the process of funding. There you go. You now know how to create pre- and post-money cap tables for your company. FundEnable's Cap Table Calculator will further simplify this process for you.


Hi there. Welcome to Fund Enable's course on Cap Tables. In our previous course, we have looked at how to prepare pitch decks and financial models. We have also seen how to identify investors and how to reach out to them. Now it is time to deep dive into the math of actually closing a deal with your investors. In this course, we will start by explaining how dilution works and how shares are issued to investors upon investments. We will explain this through the means of cap tables. Simply put, cap tables tell us who owns how much of a company at any given point in time. Here is how cap table looks. As you can see, a cap table tells us details such as who owns how much of a company at any given point in time. Who are the shareholders in the company? How much stake they own? And how many shares are issued to them? And what is the value of their shareholding? Without further ado, let's get started on how to build cap tables and why they are important in the process of funding. There you go. You now know how to create pre- and post-money cap tables for your company. FundEnable's Cap Table Calculator will further simplify this process for you. Cap tables are critical in the funding process. They capture the changes in the company's shareholding before and after investments. In fact, cap tables are also included in the term sheet and the shareholders' agreements.


There you go. You now know how to create pre- and post-money cap tables for your company. FundEnable's Cap Table Calculator will further simplify this process for you. Cap tables are critical in the funding process. They capture the changes in the company's shareholding before and after investments. In fact, cap tables are also included in the term sheet and the shareholders' agreements. Now that you have understood the math of cap tables, you are ready to explore the most exciting aspect of fundraising, which is valuations. We look forward to seeing you in our next course, where we will explain how to find valuations and negotiate with your investors.


Cap tables are critical in the funding process. They capture the changes in the company's shareholding before and after investments. In fact, cap tables are also included in the term sheet and the shareholders' agreements. Now that you have understood the math of cap tables, you are ready to explore the most exciting aspect of fundraising, which is valuations. We look forward to seeing you in our next course, where we will explain how to find valuations and negotiate with your investors. Hi, welcome to Fund Enable's course on building a financial model.


Now that you have understood the math of cap tables, you are ready to explore the most exciting aspect of fundraising, which is valuations. We look forward to seeing you in our next course, where we will explain how to find valuations and negotiate with your investors. Hi, welcome to Fund Enable's course on building a financial model. The most common questions that the investors ask during the pitch are, how much capital are you looking to raise? What do you need this money for? Over the next three to five years, what kind of revenue will you be making? And how do your cost structure and unit economics look like? To answer these questions, you need to have a detailed financial model in place. A financial model translates your future plan into hard numbers plotted on an Excel sheet.


Hi, welcome to Fund Enable's course on building a financial model. The most common questions that the investors ask during the pitch are, how much capital are you looking to raise? What do you need this money for? Over the next three to five years, what kind of revenue will you be making? And how do your cost structure and unit economics look like? To answer these questions, you need to have a detailed financial model in place. A financial model translates your future plan into hard numbers plotted on an Excel sheet. Through this course, we will explain how to project your revenue and cost, basis assumptions and historical data, and finally, come up with your funding requirement. And don't worry, if you're not well-versed with finance, we have simplified this process and will help you from scratch. We recommend that you use FundEnable's financial model template and build it step-by-step with our instructions. In the next 40 minutes, you will be ready with your first cut financial model for your business. So let's get cracking.


The most common questions that the investors ask during the pitch are, how much capital are you looking to raise? What do you need this money for? Over the next three to five years, what kind of revenue will you be making? And how do your cost structure and unit economics look like? To answer these questions, you need to have a detailed financial model in place. A financial model translates your future plan into hard numbers plotted on an Excel sheet. Through this course, we will explain how to project your revenue and cost, basis assumptions and historical data, and finally, come up with your funding requirement. And don't worry, if you're not well-versed with finance, we have simplified this process and will help you from scratch. We recommend that you use FundEnable's financial model template and build it step-by-step with our instructions. In the next 40 minutes, you will be ready with your first cut financial model for your business. So let's get cracking. There you go. You just created your first financial model. One popular opinion among investors is that they like to see businesses with a hockey stick growth. Another school of thought is that your projections should be realistic and achievable. Our advice to founders is to project numbers that you are comfortable with because ultimately you have to take the ownership of achieving them. Also, do review your funding amount closely. It is not very often that a company has raised $10 million of funding with no or very little revenue.


Through this course, we will explain how to project your revenue and cost, basis assumptions and historical data, and finally, come up with your funding requirement. And don't worry, if you're not well-versed with finance, we have simplified this process and will help you from scratch. We recommend that you use FundEnable's financial model template and build it step-by-step with our instructions. In the next 40 minutes, you will be ready with your first cut financial model for your business. So let's get cracking. There you go. You just created your first financial model. One popular opinion among investors is that they like to see businesses with a hockey stick growth. Another school of thought is that your projections should be realistic and achievable. Our advice to founders is to project numbers that you are comfortable with because ultimately you have to take the ownership of achieving them. Also, do review your funding amount closely. It is not very often that a company has raised $10 million of funding with no or very little revenue. Now that your pitch deck and financial model are ready and you know how much to raise, it's time to approach the investors. Where do you find these investors and how do you approach them? We will answer these questions in our upcoming course on Financing Pathways.


There you go. You just created your first financial model. One popular opinion among investors is that they like to see businesses with a hockey stick growth. Another school of thought is that your projections should be realistic and achievable. Our advice to founders is to project numbers that you are comfortable with because ultimately you have to take the ownership of achieving them. Also, do review your funding amount closely. It is not very often that a company has raised $10 million of funding with no or very little revenue. Now that your pitch deck and financial model are ready and you know how much to raise, it's time to approach the investors. Where do you find these investors and how do you approach them? We will answer these questions in our upcoming course on Financing Pathways. Welcome to the course on understanding term sheets. An investment is guided by many terms and conditions. All these terms and clauses are included in a document called the term sheet. Simply put, a term sheet is a letter of intent that is typically extended by the investors. The purpose of a term sheet is to detail out all the rights, responsibilities, and obligations of both the founders and the investors. Term sheet is not legally binding and is open for negotiations and discussions. In this course, we will study all the terms included in a typical angel and venture capital investment term sheet. We will also discuss how to negotiate terms in order to safeguard your interest as the founder. Let us begin right away.


Now that your pitch deck and financial model are ready and you know how much to raise, it's time to approach the investors. Where do you find these investors and how do you approach them? We will answer these questions in our upcoming course on Financing Pathways. Welcome to the course on understanding term sheets. An investment is guided by many terms and conditions. All these terms and clauses are included in a document called the term sheet. Simply put, a term sheet is a letter of intent that is typically extended by the investors. The purpose of a term sheet is to detail out all the rights, responsibilities, and obligations of both the founders and the investors. Term sheet is not legally binding and is open for negotiations and discussions. In this course, we will study all the terms included in a typical angel and venture capital investment term sheet. We will also discuss how to negotiate terms in order to safeguard your interest as the founder. Let us begin right away. Hold on. Term sheet is not legally binding. Once the term sheet is finalized and signed, lawyers convert it into a legally binding contract called the Shareholders Agreement or the SHA. Now, how does one make an SHA legally binding? Simple. By paying stamp duty and registering the agreement. The investment money is transferred into the company's bank account only after the SHA is signed by the investors and the founders.


Welcome to the course on understanding term sheets. An investment is guided by many terms and conditions. All these terms and clauses are included in a document called the term sheet. Simply put, a term sheet is a letter of intent that is typically extended by the investors. The purpose of a term sheet is to detail out all the rights, responsibilities, and obligations of both the founders and the investors. Term sheet is not legally binding and is open for negotiations and discussions. In this course, we will study all the terms included in a typical angel and venture capital investment term sheet. We will also discuss how to negotiate terms in order to safeguard your interest as the founder. Let us begin right away. Hold on. Term sheet is not legally binding. Once the term sheet is finalized and signed, lawyers convert it into a legally binding contract called the Shareholders Agreement or the SHA. Now, how does one make an SHA legally binding? Simple. By paying stamp duty and registering the agreement. The investment money is transferred into the company's bank account only after the SHA is signed by the investors and the founders. We hope this course serves as a guide for understanding and negotiating term sheet. See you.


Hold on. Term sheet is not legally binding. Once the term sheet is finalized and signed, lawyers convert it into a legally binding contract called the Shareholders Agreement or the SHA. Now, how does one make an SHA legally binding? Simple. By paying stamp duty and registering the agreement. The investment money is transferred into the company's bank account only after the SHA is signed by the investors and the founders. We hope this course serves as a guide for understanding and negotiating term sheet. See you. Let's revisit Terraman's valuation.


We hope this course serves as a guide for understanding and negotiating term sheet. See you. Let's revisit Terraman's valuation. Based on the transaction comparable method, we arrive at a 20 crore valuation. How did we arrive at this figure? We use the formula revenue multiple is equal to valuation divided by the next year revenue, which means valuation is equal to revenue multiple multiplied by the next year revenue. Revenue multiple was found by studying the hard data of actual funding rounds that have happened in the men's grooming sector. But what about the next year revenue? Where did this 10 crore come from? The founders have forecasted this number. It is calculated on Excel based on certain assumptions. But these assumptions may not hold true and the founders may or may not achieve the 10 crore number. It could go both ways. They can do more than 10 crores or less than 10 crores. Imagine that Terraman makes 12 crore revenue in the next year. With a 2x multiple, the valuation should be 24 crore. This is higher than the 20 crore valuation that we calculated. So the founders have lost out on a higher valuation. But what if Terraman makes only 2 crore revenue in the next year? With a 2x multiple, the valuation should only beat 4 crores, which is much lower than 20 crores. The investor has ended up overvaluing the company. This is exactly why valuations cannot be calculated based on a projected number from Excel. So how do we reduce dependency on projected revenue numbers? We do so by resorting to deal structures such as compulsory, convertible debentures or CCDs. So let's see how Terraman can structure their 3 crore funding deal with Lion Capital. The simplest thing to do is to not fix investor stake up front.


Let's revisit Terraman's valuation. Based on the transaction comparable method, we arrive at a 20 crore valuation. How did we arrive at this figure? We use the formula revenue multiple is equal to valuation divided by the next year revenue, which means valuation is equal to revenue multiple multiplied by the next year revenue. Revenue multiple was found by studying the hard data of actual funding rounds that have happened in the men's grooming sector. But what about the next year revenue? Where did this 10 crore come from? The founders have forecasted this number. It is calculated on Excel based on certain assumptions. But these assumptions may not hold true and the founders may or may not achieve the 10 crore number. It could go both ways. They can do more than 10 crores or less than 10 crores. Imagine that Terraman makes 12 crore revenue in the next year. With a 2x multiple, the valuation should be 24 crore. This is higher than the 20 crore valuation that we calculated. So the founders have lost out on a higher valuation. But what if Terraman makes only 2 crore revenue in the next year? With a 2x multiple, the valuation should only beat 4 crores, which is much lower than 20 crores. The investor has ended up overvaluing the company. This is exactly why valuations cannot be calculated based on a projected number from Excel. So how do we reduce dependency on projected revenue numbers? We do so by resorting to deal structures such as compulsory, convertible debentures or CCDs. So let's see how Terraman can structure their 3 crore funding deal with Lion Capital. The simplest thing to do is to not fix investor stake up front. This is to say that Terraman raised 3 crores in debt. This debt will have zero interest and will get converted into equity at the end of one year.


Based on the transaction comparable method, we arrive at a 20 crore valuation. How did we arrive at this figure? We use the formula revenue multiple is equal to valuation divided by the next year revenue, which means valuation is equal to revenue multiple multiplied by the next year revenue. Revenue multiple was found by studying the hard data of actual funding rounds that have happened in the men's grooming sector. But what about the next year revenue? Where did this 10 crore come from? The founders have forecasted this number. It is calculated on Excel based on certain assumptions. But these assumptions may not hold true and the founders may or may not achieve the 10 crore number. It could go both ways. They can do more than 10 crores or less than 10 crores. Imagine that Terraman makes 12 crore revenue in the next year. With a 2x multiple, the valuation should be 24 crore. This is higher than the 20 crore valuation that we calculated. So the founders have lost out on a higher valuation. But what if Terraman makes only 2 crore revenue in the next year? With a 2x multiple, the valuation should only beat 4 crores, which is much lower than 20 crores. The investor has ended up overvaluing the company. This is exactly why valuations cannot be calculated based on a projected number from Excel. So how do we reduce dependency on projected revenue numbers? We do so by resorting to deal structures such as compulsory, convertible debentures or CCDs. So let's see how Terraman can structure their 3 crore funding deal with Lion Capital. The simplest thing to do is to not fix investor stake up front. This is to say that Terraman raised 3 crores in debt. This debt will have zero interest and will get converted into equity at the end of one year. How much stake will the investors get after one year when this conversion happens? The stake will be dependent on the actual revenue that Terraman makes at the end of one year. Effectively, what we have done is postponed determining valuation to the next year. By doing this, the valuation is now dependent not on the projected revenue, but the actual revenue that Terraman makes.


This is to say that Terraman raised 3 crores in debt. This debt will have zero interest and will get converted into equity at the end of one year. How much stake will the investors get after one year when this conversion happens? The stake will be dependent on the actual revenue that Terraman makes at the end of one year. Effectively, what we have done is postponed determining valuation to the next year. By doing this, the valuation is now dependent not on the projected revenue, but the actual revenue that Terraman makes. On day, when the investment happens, the founders and Lion Capital agree on three things. The investment amount, the instrument and the revenue multiple. After one year, we see that Terraman makes 10 crore in revenue. At this point, the 3 crore debt will get converted into equity at a 20 crore valuation. This means that the equity stake that Lion Capital gets is 3 crore divided by 20 crore, which is 15%.


How much stake will the investors get after one year when this conversion happens? The stake will be dependent on the actual revenue that Terraman makes at the end of one year. Effectively, what we have done is postponed determining valuation to the next year. By doing this, the valuation is now dependent not on the projected revenue, but the actual revenue that Terraman makes. On day, when the investment happens, the founders and Lion Capital agree on three things. The investment amount, the instrument and the revenue multiple. After one year, we see that Terraman makes 10 crore in revenue. At this point, the 3 crore debt will get converted into equity at a 20 crore valuation. This means that the equity stake that Lion Capital gets is 3 crore divided by 20 crore, which is 15%. Now imagine two different scenarios. The COVID-19 pandemic has struck, and the business comes to a halt. Terraman has only been able to do a 1 crore revenue by the end of the year. This means that the valuation will only be 2 crores. This is lesser than the funding amount of 3 crore. This implies that Lion Capital will end up acquiring a 100% stake in Terraman. This doesn't make any sense for both the founder and the investor. The other scenario is that Terraman does exceedingly well and makes a 50 crore revenue. In this situation, the investor will end up getting an insignificant stake of 6%. This is not lucrative for Lion Capital at all.


On day, when the investment happens, the founders and Lion Capital agree on three things. The investment amount, the instrument and the revenue multiple. After one year, we see that Terraman makes 10 crore in revenue. At this point, the 3 crore debt will get converted into equity at a 20 crore valuation. This means that the equity stake that Lion Capital gets is 3 crore divided by 20 crore, which is 15%. Now imagine two different scenarios. The COVID-19 pandemic has struck, and the business comes to a halt. Terraman has only been able to do a 1 crore revenue by the end of the year. This means that the valuation will only be 2 crores. This is lesser than the funding amount of 3 crore. This implies that Lion Capital will end up acquiring a 100% stake in Terraman. This doesn't make any sense for both the founder and the investor. The other scenario is that Terraman does exceedingly well and makes a 50 crore revenue. In this situation, the investor will end up getting an insignificant stake of 6%. This is not lucrative for Lion Capital at all. To protect both the investor's and the founder's interest, we use a floor and a cap structure. The cap ensures that the founder doesn't end up losing half of their company due to poor performance, while the floor ensures a certain minimum stake that the investors are entitled to, regardless of how well the company performs.