Dirty term sheets, also known as predatory term sheets, are used to describe term sheets that are riddled with one-sided provisions and terms that are not in the founders’ favor. They are often deployed when a startup wants to raise capital while maintaining its inflated valuation and are based on internal rate of return mechanics other than price such as—price in kind dividends, or guaranteed multiple hurdles. Dirty term sheets misalign the interests of investors and operators, as investors focus their efforts solely on pushing the startup to go public. AVOID dirty term sheets at all costs.