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Term Sheet Exit Waterfall Calculator

calc_term_sheet_waterfall
Read-onlyIdempotent

Splits the sale proceeds between one preferred class and common holders for a liquidation multiple and participation clause (non-participating, participating uncapped, participating capped at 3x). Returns the conversion point, a sensitivity table and the three standard structures side by side. Same math as https://modevc.com/tools/term-sheet-waterfall. Illustrative model: one preferred class, no seniority stack, no debt or fees.

Input Schema

NameRequiredDescriptionDefault
participationNoParticipation clause. Web default non_participating.
exit_valuationNoSale price in USD. Web default 45,000,000.
preferred_investedNoTotal invested by the preferred class in USD. Web default 12,000,000.
liquidation_multipleNoLiquidation preference multiple. Web default 1.
pro_rata_current_pctNoYour current ownership for the pro-rata check, in percent. Web default 10.
preferred_ownership_pctNoAs-converted ownership of the preferred class, in percent (1 to 95). Web default 30.
pro_rata_next_round_sizeNoNext round size in USD for the pro-rata check. Web default 15,000,000.

Schema Changelog

Changes observed during successful MCP inspections.

  1. Added

TDQS

A4/5.0
Behavior4/5

Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

Annotations already declare readOnlyHint, idempotentHint, and non-destructive behavior, so the safety profile is covered. The description adds real value beyond that: it discloses the return shape (conversion point, sensitivity table, three structures side by side), the model's fidelity limits, and that the web calculator substitutes defaults for zero values.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Conciseness5/5

Is the description appropriately sized, front-loaded, and free of redundancy?

Three tight sentences: the operation first, then the return contents, then the model limitations and reference URL. Every clause earns its place with no filler.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Completeness4/5

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

With no output schema, the description steps in to describe the returns (conversion point, sensitivity table, side-by-side structures) and bounds the model's assumptions. An agent has enough to call it and interpret results, though it doesn't specify units/format of the returned table.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Parameters3/5

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

Schema description coverage is 100% with enum constraints and zeroNote annotations on every parameter, so the schema carries the parameter burden. The description adds nothing parameter-specific beyond mentioning the participation options already enumerated in the schema; baseline 3 is appropriate.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Purpose5/5

Does the description clearly state what the tool does and how it differs from similar tools?

States a specific verb and resource ('splits the sale proceeds between one preferred class and common holders') and enumerates the three participation modes it handles. An agent can distinguish this from siblings like calc_safe_dilution or calc_cofounder_equity without opening any schema.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Usage Guidelines3/5

Does the description explain when to use this tool, when not to, or what alternatives exist?

The description scopes the model ('one preferred class, no seniority stack, no debt or fees'), which implicitly tells the agent when the output is not applicable. However, it names no alternative tool and gives no explicit when-to-use/ when-not-to-use guidance relative to the other calc_* siblings.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.

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