Demystifying Venture Capital investment: The HSBC Venture Capital Term Sheet Guide 2024

3 April 2024 | 2 minutes

Whether you're a first-time founder, a seasoned veteran or an investor, term sheets are an important part of the investment process.

Understanding industry standards and being able to benchmark terms when negotiating your investment is paramount. 

We teamed up with HSBC Innovation Banking and other industry experts to contribute to their go-to report identifying and demystifying the current market of investment terms. The report aims to empower both founders and investors with a practical understanding of the key terms and clauses of a term sheet, equipping you with the knowledge needed to confidently negotiate your next VC investment round and to drive alignment in this important ecosystem. 

Understanding the terms of your investment, and how they reflect the market, is fundamental for value protection and growth

The results are enlightening, a couple of highlights of which are:

  • Seed investments increased from 24% in 2022 to 29% last year, highlighting investors’ growing appetite for earlier-stage investmen
  • 2023 saw a material increase in HealthTech, ClimateTech and AI term sheets, as these sectors grow in importance
  • International investors represented over 50% of all late-stage investments (Series B & C+) into UK companies in 2023
  • 11% of term sheets surveyed had a diversity clause, up from 8% in 2022

Read the full HSBC Innovation Banking report here

This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.


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