Venture Capital Investment Model Agreements (VIMA) by SAL and SVCA provide a set of model agreements for use in seed rounds and early stage financing.
1. Startups and investors can use these to negotiate commercial terms.
These model agreements are optimally used as common reference for
discussion. Parties should then go to lawyers to advise on legal terms
and legal issues BEFORE agreeing to any term sheet.
After taking legal advice, execute term sheet and get lawyers to assist
in amending the Model Agreements to reflect the terms.
This way, the process will be more cost- and time-efficient. Lawyers
can value-add for the advice and bespoke drafting of specific terms in
the Model Agreements, and not have to spend much time reviewing some
other party’s precedent documents. All round, the legal and admin costs
should appreciate lawyers’ value-add in this. Do not assume that this
will do away with lawyers. I have seen many executed agreements where
parties DIY and had no idea what they were writing or signing. There
have been only very few agreements done impressively, usually because
they have in-house lawyers.
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