Document background
A Letter Of Intent Venture Capital document is a crucial preliminary step in the venture capital investment process under Swiss law. It is typically used when a venture capital firm has identified a potential investment target and wants to formalize their preliminary understanding before proceeding with detailed due diligence and definitive agreements. The document outlines key commercial terms such as valuation, investment amount, and basic governance rights, while typically maintaining a non-binding nature except for specific provisions like confidentiality and exclusivity. In the Swiss context, this document must comply with the Swiss Code of Obligations and relevant financial market regulations, particularly when dealing with regulated investment vehicles or when foreign investors are involved. The LOI serves as a roadmap for the transaction and helps align parties' expectations early in the process, reducing the risk of misunderstandings during later negotiations.
