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Trip4real: Negotiating Series A

By Luisa Alemany, Carlos Trenchs, Lourdes Urriolagoitia, Suzanne Jenkins


On 25 March 2014, Trip4real founder Gloria Molins was on her way to Barcelona airport, where she and her small but passionate and audacious team would meet up and fly to San Francisco to pitch Airbnb’s co-founders on a partnership, when her phone buzzed. She had received a term sheet proposal for a €1 million Series A round from a venture capital (VC) firm. She felt a rush of gratitude. She had launched Trip4real less than two years ago, with the aim of connecting travellers with local people for authentic and meaningful experiences, and securing these funds would make it possible for her to fulfil her dream of changing the way people travel. Reading the term sheet, however, she saw several clauses that she needed to evaluate. This would be the first time she negotiated venture funding, and she needed to sort through the terms, define her priorities, and develop a strategy before sitting down with the experienced investors. And she needed to do it fast, since the term sheet would expire in 10 days.

Learning objectives

Recognise the key clauses of a standard VC term sheet and interpret their meaning:

1. Explain the consequences of a weak term sheet for both founder and investor.
2. Understand why investors need to have certain clauses to protect their minority interest in the start-up.
3. Identify avenues to improve the term sheet from the entrepreneur’s perspective.
4. Generate creative win-win strategies to negotiate a better outcome.
5. Experience a key moment in the financing of a start-up and what it implies.


Publication Date: November 2019
LBS Case Code: CS-19-018
Subjects: , , ,
Pages: 14
Format: pdf