Fundraising & Equity
No-Shop & Exclusivity Clauses in Term Sheets
Collated by Harry Prabandham
Curated by Rubric Financial
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What No-Shop Means
- A no-shop (exclusivity) clause prohibits the company from soliciting or engaging with other investors for a specified period after signing a term sheet
- Standard duration is 30-45 days — enough time for the lead investor to complete diligence without the founder shopping the term sheet to competitors
- During the no-shop period, you cannot seek competing offers, share the term sheet with other investors, or negotiate parallel deals
- Violating a no-shop clause can kill the deal and damage your reputation in the investor community permanently
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