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Good idea, I think this will benefit lots of startups and some angels. I'm interested to know why you didn't choose a convertible note structure...

Ted Wang

We went with equity because ivestors would prefer to get equity for the following reasons:

1. Sets the valuation at the time of the investment.
2. Locks in rights, preferences and priviledges of the stock.
3. Investors get stockholder rights (as opposed to being mere creditors).
4. Less likely for mischief by subsequent investors.
5. Long term capital gains possible for early exit.

One of the reasons notes have become so popular is that the equity documents were too expensive. I'm hoping this will ease that problem.



If these were based on the NVCA docs, it would be handy to post a redline -- at least of the COI. Yes, I know it's a pretty easy read without the redline -- but I suspect many people might want to see one.



I'm not able to get the files to download with firefox. Is it something simple that I'm doing wrong?

Dan Greenberg

I second the Firefox comment. Could you indicate what file type (.DOC, .TXT, .RTF, .DOCX, etc.) these files are in? We *really* appreciate your putting these docs out there!

Ted Wang

They are word docs so the .doc extension should work. Will try and fix today.

Peter Leahy

It would be helpful to get a California standard employee manual, employee contract/agreements, IP ownership release to company, and confidentiality. All of those cost us as much if not more in legal time than the seed round.

Rob Babcock

Ted - I think if you simply remove the spaces in the file names, that should solve the download problems, e.g. the term sheet doc should be renamed to "SeriesSeedTermSheet.doc". Same with the others. :)


Thanks for creating.

Regarding Firefox, I just downloaded each in Firefox. Choose "Open With" and able to save as Word doc.


In reviewing these documents on the term sheet, last item, how is the term "double trigger" defined. I was unable to see any reference to trigger events in other documents or is this just a "commonly understood" term?


I see there is no support for the assertions that the benfits of using standardized documents outweights the costs of customizing and negotiating important issues. I think opinions differ on this.

One note: If I was a corporate officer I would insist on the COI providing for mandatory indemnification to the extent permitted by law. I would also want an indemnification agreement, but in any event, where the goal is standardization and cost containment, indemnifying officers in the COI is a good place to start. If the VC's won't agree to officer indemnification in the COI, I would consider that a red flag, as an officer.

Good luck with the project.


Double trigger is a term of art that means (a) there is a change in control of the company (i.e. it is acquired) and (b) the employee is terminated without cause (or sometimes resigns for good reason). This is all built into a typical founder stock purchase agreement. I've not included those in this project (nor the other documents requested above).


Acton: I can't prove the assertion, but it's a judgment that I've developed after years of doing this work and is seconded by my launch partners all of whom are experienced investors.

With respect to the indemnity provision, the company is authorized to do give full indemnity to its officers (Article VII(B)) I think mandatory indemnity for officers to the fullest extent of the law in the charter is problematic because it can create odd incentives for terminated officers to sue the company. I've not seen that in any charters so don't believe it's a standard term.


Technical issues are fixed for Firefox users (thanks Rob for the comment)


Ted: Great service to the startup community!

I echo Peter's request. Standard 1-way/bi-lateral NDA's, standard templates for an employee manual, employee contract/agreements, IP ownership release to company are on my wish-list too.

A template for promissory notes would be nice to have as well.


Thanks for that but where is the SHA template ?

There are some Vesting terms for founders in the term sheet but I can't find them in the others documents too.

Thanks in advance!


Great effort! Thanks for shouldering this burden.

It will be immensely helpful in those jurisdictions which lack sophisticated, VC-oriented legal communities, such as Colorado and most of the West (other than California and Washington of course) and where seed rounds are substantially smaller.

Thanks again!


Thanks for your great work!

The drag-along section 2.3 of the Series Seed IRA in it's current form looks not complete to me. Specifically it would benefit from a clause nullifying these drag-along rights in case of a proposed sale to a preferred-affiliated entity.

Kind Regards.


This is great...simplified funding/founders docs out of the box. I've not studied them yet, but at first glance I can see some really slick technologies being transferred into a Newco with these basic terms, and funding a lot more deal flow.

Bloom Energy get out of the way!

Thanks for this initial set of docs, and for fixing the firefox download.


This is great! I know at our startup we are using the LLC form instead of the C corp form - if we decide to go public later or are otherwise required by large investors' needs, we would convert to a C corp, but for now our approach is to be an LLC.

Given that LLC's probably are not uncommon, is there any possibility that you would create documents for LLC's as well?

Ted Wang

One the request for additional forms, its not on my road-map right now. My quest is to simplify financing for seed stage investments. That's a big job and until I've made significant progress, I'm not going to look at doing the same for other forms.

Ted Wang

On the drag along, it's a good point. The reason I omitted those admittedly standard carve-outs is that it is truly a convenience drag along, meaning that the sale has to be approved by all of the Board, the majority common and the majority preferred. My thinking is that if all three constituencies favor the sale, there's probably no need for the standard carve-outs.


If you want to know the best site for getting all the articles in PDF, you may ask me. it is one of pdf search engines (for example http://www.pdfqueen.com)

Jason Winters

In the IRA document, section 5.7, the first sentence reads "This Agreement, and any and all rights, duties and obligations hereunder, shall not be assigned, transferred, delegated or sublicensed by an Investors with the prior written consent of the Company."

Shouldn't it be "... without the prior consent ..."?


Yes. Good catch. Will fix ASAP.


More on the drag along. Better be safe than sorry. Please take a look at this account of not so distant past story


Alexander Jarvis

Buoyed by what you and a few others have contributed, I was inspired to set about getting the entrepreneurial community to join together and create an “open source” resource more widely speaking.
All entrepreneurs have to go through largely the same processes, spending cash and precious time that could be better spent elsewhere should they have a helping hand; each other’s.
I put a site up today as ground zero.
It can be found here: http://opensourcestartup.com/
As a community we can achieve a lot. Hope you will join.

William Carleton

Ted, I just read the SPA and the IRA and they are terrific. Can't wait to try them out, coupled with the flat fee aspiration.

What do you think of some kind of clearinghouse that people could voluntary report to, indicating that they've used the documents in x jurisdiction raising y dollars from z investors.

Susan Morgan

Hi Ted - thanks for all the work in putting these together. I think they will be a big help (to entrepreneurs and attorneys alike). See my post (on the Walker Corporate Law Group blog) in support of your positions: http://bit.ly/dlxpQu.


I hope similar initiatives existed for startups in India ..

Quyen Kiet

Is there a recommended set of agreements founders should enter into (some kind of joint venture boilerplate) prior to engaging with investors? For example, you have 3 friends who have a great idea for a company and they have agreed on their %share, and so what agreement should they use to formalize this preliminary association before they've commenced putting the 80 hours a week in development time? I assume there should be some document they can sign ahead of time that would flow neatly into the above documents once the corporation is formed? Many entrepreneurs starting off need something like this when they create an offer for their founding team.

Ted Wang

This is typically done in a founder stock purchase agreement which contains vesting. That document does two specific things (a) gives everyone a firm number of shares in the company and (b) sets up a "vesting" period. What vesting means in this context is that you get issued a certain number of shares but those shares are subject to being repurchased by the company at nominal cost if you leave the company (either by quitting or by being fired by the other two guys). I've not posted a form to date on this but I am thinking about doing so. The problem is that they are very fact specific so difficult to do without counsel.

Jim Collins

Alex Jarvis...your link: http://opensourcestartup.com/ requires a paasword. Is there anything happening with this idea?

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