Committee, Term Sheets and Disbursements
The end of the pipeline: putting a deal to committee, issuing terms, and releasing money in tranches. Which of these you get depends on your investor type.
What you will learn
- How an IC review is run and finalised
- Issuing a term sheet and what the founder can do with it
- Setting up tranches and the maker-checker rule
- The disbursement statuses in order
- What to do when there is only one of you
Who gets what#
These three features are gated on investor type, not on plan. An Angel gets term sheets but no committee and no disbursements; a Broker gets none of them.
| Feature | Who has it |
|---|---|
| Investment committee | Everyone except Angel and Broker. |
| Term sheets | Everyone except Broker. |
| Disbursements | Everyone except Angel, University fund and Broker. |
Good to know
If the tabs are missing from your deals, check your investor type before assuming something is broken. The dashboard strip tells you in one glance.
Investment committee#
A structured way to get a decision on the record: reviewers give an opinion, then somebody finalises the outcome.
- 1
Open IC review on the deal
Available once the deal reaches the IC review stage.
- 2
Collect reviews
Each reviewer records their view. Your investor type caps how many reviewers you may have.
- 3
Finalise the decision
Recording the outcome advances the deal for you - you do not finalise and then separately move the stage.
Tip: The deal page tells you it is waiting on the IC decision, so a deal parked in IC review usually means nobody has finalised.
Careful
Angel investors: the route to a term sheet still passes through the IC review stage even though you have no IC tabs. Move the deal through it - nothing blocks you, there is simply no committee step to perform.
Term sheets#
Issue terms to the founder and track what they do with them. The negotiation happens in the open, against the deal.
- 1
Issue from the Term sheet tab
The startup sees it in their own portal.
- 2
They accept, or they negotiate
A counter comes back attached to the deal rather than as an email nobody else on your team can see.
- 3
Move the deal on
Term sheet leads to Negotiation, and Negotiation to Closed. Closing asks you for the amount actually agreed.
Tip
The closed amount is the number your portfolio and every return figure is built on. It is frequently not the amount originally asked for - enter what was really agreed.
Disbursements#
Money is released in tranches rather than in one lump, so each release is approved and recorded separately.
- 1
Create the disbursement against the deal
Set out the tranches - how much, and against what.
- 2
A second person approves it
The person who created it cannot approve it. This is the maker-checker rule and it is not configurable.
- 3
Release a tranche
Approve the tranche, start the payout, then mark it complete once the money has actually moved.
- 4
Repeat for the next tranche
Each one goes through the same approve, pay, complete sequence.
| Status | Meaning |
|---|---|
| Draft | Being set up. |
| Pending approval | Waiting on a second person. |
| Approved | Cleared to release. |
| Processing | A tranche payout is in flight. |
| Completed | Everything released. |
| Failed | A payout did not go through. |
One-person organisations cannot approve disbursements
Maker-checker needs two people, and there is no override. If you are a single-member organisation and you need to disburse, you must add a second member first.
Good to know
The platform records the release; it does not transfer funds. Completing a tranche means the money moved through your bank, and you are recording that it did.
After the money moves#
- 1
Add the holding to your portfolio
Closing a deal and disbursing money are not the same as owning a recorded position. Add the holding.
- 2
Mark it
An unmarked holding shows as worth nothing, which will drag your reported value down until you record a valuation.
Common questions#
Correct, and deliberate. Somebody else has to. If there is nobody else, add a second member.
Tranche actions depend on the state of both the parent disbursement and the tranche itself. Refresh the page and check both - the sequence is approve, then pay, then complete.
The stage machine will not let a deal reach Closed without passing through Term sheet and Negotiation, so in practice no.
Then move through the IC review stage without recording reviews. It is a stage in the pipeline, not an obligation.
Whoever has the Disbursement module on their role - typically Managing Partner and Finance Manager.
