Resources
Deal Term Benchmarks
What is market today, what to ask for instead, and why it matters to your side of the table. Benchmarks are derived from the demonstration deal set on this platform.
Median redemption
52%
Average completion rate
39%
Average PIPE
$98M
Average enterprise value
$874M
| Term | What's market | What founders should push for | Why it matters |
|---|---|---|---|
| Sponsor promote | 20% of IPO shares (≈4–6% post-deal) | Tiered earnout: 25–50% vesting at $12.00 / $14.00 | Aligns sponsor payout with post-close share price rather than closing alone. |
| Minimum cash condition | $75M–$150M | Firm, non-waivable without founder consent | The single most important protection against a redemption wipeout. |
| PIPE size | 30–60% of transaction cash | Committed before signing, with anchor investor | Replaces redeemed trust and validates valuation. |
| Founder lock-up | 6–12 months | 12 months with early release at $12.50 for 20 of 30 days | Signals conviction without trapping the team indefinitely. |
| Sponsor lock-up | 12 months | Match or exceed founder lock-up | Prevents sponsor exit ahead of management. |
| Earnout to sellers | 10–20% of consideration | Revenue or EBITDA milestones, not price-only | Operational milestones are within management's control. |
| Termination fee | 1–3% of equity value | Reciprocal | Deters a sponsor from walking under deadline pressure. |
| Warrant coverage | 1/2 to 1/3 warrant per unit | Model overhang into pro-forma cap table | Warrants dilute on the way up, exactly when it hurts. |
| D&O insurance | $20M–$60M tower | Bound before proxy filing | Projection liability is real and the market prices late buyers punitively. |