BRAVE: VC Term Sheets VS. Founder Control, Valuation Myths, Governance & Deal Failure - E663

Youtube:https://youtu.be/NkyBN1lpPPc

Spotify:https://open.spotify.com/episode/3hvcfx1VO09gTf8RxjNbqw?si=1b84cca7134a4d35

"I met a founder in Singapore who was crying. I asked why. He had received a term sheet that was onerous on both economic and control rights. More importantly, it was an exploding term sheet that had to be signed immediately or it would be withdrawn. He called his lawyer, who told him not to sign, but he did anyway because he felt there was no alternative. The next day, he regretted it. He could not sleep. From a founder’s perspective, that is deeply sad. From a VC perspective, you have to respect the investor, because they effectively secured the company at about half the price." - Jeremy Au, Host of BRAVE Southeast Asia Tech Podcast

"Is my company worth this much? Egos often get in the way. I know a startup that had an opportunity to raise money at a price that was effectively flat to the prior round. The prior-round investor refused to sign, vetoed the deal, and pushed for a higher valuation. The company failed to close the capital and died about a year later. This shows the dynamic where, as an incoming VC, you are negotiating not just with the founder, but also with the board and early shareholders." - Jeremy Au, Host of BRAVE Southeast Asia Tech Podcast

"Another important issue is control rights. When someone asks for a high valuation, you can trade valuation for control rights to manage risk. These rights shape governance between founders, management, early shareholders, and later shareholders. They matter more than many founders realize. Over time, control disputes have destroyed many companies." - Jeremy Au, Host of BRAVE Southeast Asia Tech Podcast

Jeremy Au breaks down how venture capital deals really close, why many fail after the term sheet, and how financial and control rights shape outcomes for founders and investors over a 10-year relationship. Drawing from real cases across Southeast Asia, he explains the hidden trade-offs behind valuation, governance, and trust, and why “good economics” can still destroy long-term value if handled poorly.