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As the seed-stage startup fundraise process has received more transparency in recent years, ranging from published advice on how to raise seedcapital to increased availability through AngelList, Funders Club, and various accelerator programs, I’ve noticed another trend emerging.
The term sheet converts all the convertible debt into a post-moneyvaluation of $100, essentially making the convertible debt worthless. The new money comes in at a pre-moneyvaluation of $100, but includes a complete refresh of founder equity to 40% of the company. So they recapitalize the company.
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Pre-Money Valuation 
336 
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