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by Undo Capital
December 15, 2025
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What Is a Fundraising Term Sheet?

A fundraising term sheet is a non-binding document that outlines the key commercial and legal terms of an investment before full legal agreements are drafted.

Fundraising Term Sheet Meaning

The fundraising term sheet's meaning centres on setting expectations early in the deal process. To define a fundraising term sheet in practice, it summarises the proposed valuation, investment amount, share class, investor rights, liquidation preferences, board composition and key protections. While not usually legally binding, a clear fundraising term sheet definition provides the framework for negotiation and speeds up the drafting of final documents. For founders and investors, the term sheet stands for alignment on price, control and risk before committing to detailed legal work.

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Disclosure Notice: This communication is issued by Undo Capital Limited (“Undo Capital”) and is provided strictly for informational purposes only. It contains general information and should not be relied upon as accounting, business, financial, investment, legal, tax, or other professional advice. Undo Capital is not regulated by the Financial Conduct Authority (FCA) and does not provide investment, financial, or tax advice. Our services are designed to assist startups and businesses with company formation, legal agreements, and funding-related documentation. Nothing in this communication constitutes, or should be construed as, a recommendation, offer, or solicitation to purchase or sell any security or financial instrument.
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Disclaimer: Our services are designed to assist startups and businesses with company formation, legal agreements, and funding-related documentation. We do not provide investment advice, financial advice, or tax advice, nor are we regulated by the Financial Conduct Authority (FCA). Participating in startups and early-stage enterprises carries inherent risks, including limited liquidity, absence of dividends, potential loss of investment, and dilution. Any decisions regarding investments should be made independently by the investor as part of a well-diversified portfolio.