Services-Against-Equity Term Sheets & Legal Frameworks
We reject hidden fees, opaque incubation covenants, and predatory early dilution. For qualifying AI startups across India, DBERT deploys dedicated software engineering squads, sovereign infrastructure, and validated hiring pipelines in exchange for transparent, milestone-gated equity—preserving 100% of your critical early cash runway.
The technical equity specifications, annotated contractual clauses, and downloadable reference term sheet templates published below are curated for structural transparency, educational analysis, and startup collaboration modeling. They do not constitute formal binding legal advice. Startup founders must independently consult qualified Indian corporate legal counsel before formally incorporating agreements or legally modifying share capital tables under the Companies Act (2013).
The 2% – 8% Standardized Co-Development Model
Our advisory equity engagements are explicitly categorized into three rigid structural tiers based directly upon engineering labor volume, compute infrastructure complexity, and dedicated sprint team duration. Every level utilizes standardized Founder Advisor Standard Template (FAST) or sweat equity shareholder structures designed to integrate without friction into subsequent institutional fundraising due diligence.
2% – 3% Advisory Equity
Targeted at technical founders who possess active internal code execution squads but require experienced senior enterprise systems architecture oversite to avoid scaling bottlenecks and infrastructure security misconfigurations.
- Weekly architectural codebase pull-request reviews
- Vector database indexing & RAG schema optimization
- Direct access to our audited 1,500+ developer hiring pool
- Official Udyam/MSME corporate technical audits
4% – 5% Sprint Equity
Designed for pre-seed founders and domain experts who need complete zero-to-production execution of their initial minimum viable commercial AI product without spending capital on external software development agency invoices.
- 4 to 8 week agile code engineering sprints
- Dedicated full-stack React/Next.js UI/UX production
- Containerized MLOps server orchestration setup
- Non-dilutive cloud compute seed grant eligibility
6% – 8% Venture Equity
A deeply integrated structural co-founding partnership. DBERT embeds an elite, specialized applied engineering squad managed directly by senior technical leadership to operate as your acting external AI technology organization.
- Dedicated engineering squad (Applied AI Fellowship leads)
- Custom LLM parameter fine-tuning on domain data
- Continuous ongoing operational SLAs & DevOps
- Direct institutional angel investor introductions
Critical Structural Term Sheet Clauses Explained
Traditional venture studio covenants frequently obscure restrictive clauses within complex legal legalese. Below, we publish our core architectural clauses complete with explicit translation notes explaining why each term exists and how it actively safeguards founder rights.
Clause 1: Milestone-Gated IP & Code Assignment
Founder Protection"All intellectual property, proprietary source code commits, custom model weight embeddings, and algorithmic documentation authored by DBERT technical squads under this agreement shall be automatically, irrevocably, and exclusively assigned to the Startup corporate entity immediately upon validation and integration of each designated sprint milestone deliverable into the official main source control branch."
Why we structure it this way: Most traditional software agencies withhold intellectual property ownership until full financial completion invoices are settled. In an equity co-development relationship, you must hold unimpeded legal ownership over your source code at every progressive stage of growth to satisfy external investor legal due diligence and maintain technical self-reliance.
Clause 2: Anti-Clawback & Shared Execution Risk
Zero Financial Risk"In the event that the Startup commercial venture is formally concluded, restructured, or commercially unsuccessful prior to the realization of a liquidity event or public offering, DBERT expressly waives any right, option, or claim to financial recovery, retrospective labor fee conversion, or cash reimbursement for engineering development sprints rendered."
Why we structure it this way: Building innovative artificial intelligence software carries inherent algorithmic and commercial adoption risks. When we sign an incubation term sheet, we step onto your cap table as authentic co-builders—we consciously assume execution risk alongside you rather than functioning as speculative debt collectors.
Clause 3: Non-Interfering Governance & Pro-Rata Dilution
Cap Table Cleanliness"Advisory Shares issued under this agreement shall constitute standard voting or non-voting common stock equivalents carrying zero blocking rights, veto authority, or preferred operational governance mandates over executive corporate decision-making. Upon the execution of subsequent priced financing rounds, DBERT equity shall subject itself to proportional pro-rata dilution identical to founding common shareholders."
Why we structure it this way: Institutional venture capital investors intensely dislike bloated early advisory covenants that attempt to preserve unrealistic anti-dilution ratchets or disruptive operational board voting vetoes. Our framework ensures your cap table remains perfectly clean, streamlined, and highly attractive for subsequent Series A lead term sheet negotiations.
Download Standard India FAST Term Sheet (.PDF)
Access our open-source, non-binding reference template containing explicit vesting schedules (2-year vesting with a standard 6-month cliff), IP assignment schedules, and statutory corporate Indian definitions.
Founder Term Sheet FAQ
Executing a formal priced equity valuation or shareholder formalization across Indian corporate legal jurisdictions (MCA/FDI compliance) can consume months of costly operational overhead. Founder Advisor Standard Template (FAST) agreements simply execute a milestone-driven advisory grant that instantly aligns engineering deliverables without complicating your early capitalization table or holding up ongoing engineering sprint velocity.
Our standardized legal contracts contain strict milestone-gated equity tranches. Every individual sprint deliverable (e.g., custom RAG pipeline deployment, vector indexing optimization, UI/UX client release) must formally pass rigorous integration criteria on your Git repository before the associated equity tranche vests. If milestones remain unfulfilled, zero equity vests and you retain complete legal rights to all contributed codebase commits up to that point.
Yes. Our reference frameworks are adapted specifically for Indian entities incorporated under the Companies Act (2013), seamlessly integrating with official Udyam/MSME recognition parameters, standard shareholder agreement (SHA) protection clauses, and statutory sweat equity or ESOP pool allocations.
Absolutely. We actively encourage founders to review every section of our standardized open-source templates alongside independent corporate legal advisors. Our aim is total transparency and mutual execution speed, not rigid or predatory contractual entrapment.
DBERT advisory equity grants act as lightweight common or advisory allocations that sit alongside standard founder equity. When you transition into formal Seed or Series A financing rounds led by institutional venture funds (such as Y Combinator, Peak XV, or Blume Ventures), our equity simply converts or dilutes alongside founding shareholders according to standard industry pro-rata practices.
Never. We act as genuine engineering co-builders who intentionally share venture execution risk alongside you. If your startup undergoes a commercial pivot or ultimately ceases operations, the granted equity simply dissolves without any retrospective cash clawback or financial indebtedness for technical sprints performed.
Ready to Build With Aligned Technical Leadership?
Submit your pitch deck and architecture summary today. Our senior engineering leadership evaluates incoming proposals on a weekly rolling basis.