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A VC firm is evaluating the following two term sheets, Term Sheet A and Term Sheet B. Both term sheets are for a $3 million

A VC firm is evaluating the following two term sheets, Term Sheet A and Term Sheet B. Both term sheets are for a $3 million investment in the same startup, InnovaCo:

Term Sheet A values InnovaCo at a $9 million post-money valuation.
Term Sheet B values InnovaCo at a $7 million pre-money valuation.

Consider the following statement: Term Sheet A must be better for the VC firm than Term Sheet B because it places a lower valuation on the startup. Is the statement true or false? Why?

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