At the risk of making us obsolete, this new online service was too cool not to link to.  The Silicon Valley law firm of Wilson Sonsini Goodrich & Rosati recently launched a free Term Sheet Generator for clients and prospective clients.  According to their website, the Generator:

“will generate a venture financing term sheet based on your responses to an online questionnaire. It also has an informational component, with basic tutorials and annotations on financing terms. This term sheet generator is a modified version of a tool that we use internally, which comprises one part of a suite of document automation tools that we use to generate start-up and venture financing-related documents.

Because it has been designed as a generic tool that takes into account a number of options, this version of the term sheet generator is fairly expansive and includes significantly more detail than would likely be found in a customized application.”

For the first-time entrepreneur, the Generator does a decent job of explaining the various terms and options.  Old pros will love the ease with which they can navigate different terms and produce a quick proposal to present to prospective investors.

All kidding aside, the Generator does not replace the need for a lawyer (it was invented by a law firm after all).  First time entrepreneurs may still need some guidance on valuation and customary terms for their fund raising round.  Old pros may still want something a little more custom, or want counsel in the negotiation phase.  In both cases, a lawyer is still needed to draft the final documents.

What the Generator does best, I think, is allow the entrepreneur to get started quickly, to do the initial ground work, before consulting with the lawyer.  For the lawyer, term sheets produced by the Generator are a great starting place, allowing lawyer and client to quickly get past the basics and on to more important aspects of the deal.

–Matt