Can startups just walk away from an investment term sheet?

You and your co-founders have been pitching for the past several months, and now you’ve finally got the investment term sheet from venture capital. You later sat down with the signed term sheet to discuss the next steps with your team members. Eventually, after asking around for feedback and inputs you and your team later…

What are reserved matters, and how does it work for startups?

Reserved matters are a standard clause that can be found in a shareholders agreement, especially when dealing with more sophisticated investors like venture capitals and institutional entities like corporates. What is a reserved matter, and what is it for actually? The reserved matters set out a list of actions or items which the company cannot…

Why startups shouldn’t use their investor’s company secretary

You’ve been pitching your startup for a few months now, and finally, an angel investor has agreed to invest in your company with the investment amount you needed. In the term sheet, the angel investor also requires you to change the company secretary to the investor’s corporate secretarial firm instead. This is usually not a…

Why startup founders should not buy an “off the shelf company”

Setting up a company can be costly, especially for many bootstrapped founders. Of course, you are trying to save money and all, and that’s understandable. Bootstrapped founders do this by buying a shelf company or ‘off the rack’ shell company offered by corporate secretarial firms which I don’t think is a good idea. Let me…