A lead investor wants information rights, pro-rata, and a board observer seat. They've sent a side letter. The round closes Friday and the lawyer's on holiday until Monday.
Side letters can be e-signed without ceremony. Get it done.
Read the side letter carefully
Before signing, understand exactly what you're agreeing to. Information rights (what data the investor gets and how often), pro-rata rights (their right to participate in future rounds), board observer or director rights, and any special protections. Side letters often outlast the investment by years.
Send for signature
Use sign PDF to drop signature fields for both parties. Founder signs first (most common), investor signs second. The audit trail captures timestamps and IPs for both signatures. Saves the round closing without the side letter being held up.
Save alongside the SAFE or term sheet
Save the signed side letter in the cap table folder alongside the SAFE or term sheet. The side letter modifies the investor's rights — anyone looking at the cap table should see both documents together. Maintain a clear naming convention so they sort.
Update the cap table notes
Note the side letter's existence in your cap table software (Carta, Pulley, etc.) so future hires and investors see the obligations. Side letters are often forgotten because they sit outside the main agreement; the systematic note prevents nasty surprises in later rounds.
FAQ
Are side letters enforceable when e-signed?
Yes — side letters are commercial contracts and electronic signatures are universally valid in both US and UK jurisdictions.
Can I negotiate a side letter after signing the main investment?
Technically yes, but harder. Negotiate concurrently with the main investment for leverage.
Should side letters be shared with future investors?
Yes during due diligence — investors will ask. Material side letter terms can affect their willingness to invest at the same terms.
What's the most common side letter term?
Information rights and pro-rata. Both are common. Board observer rights are common for larger checks.
Side letters close rounds. Send via Flint and Friday's close stays on track.