Signing marks execution of deal documents — the legal commitment to transact — which may still require days or weeks before closing completes.

How it works

In a venture round, parties sign stock purchase agreements, amended charter, and ancillary docs. Funds may wire at signing if conditions are minimal, or hold cash in escrow until closing. M&A often announces “signed” deals with a later closing date pending antitrust, shareholder votes, or third-party consents.

Signing without closing risk appears when buyers walk after material adverse changes or failed conditions — break-up fees may apply in larger transactions.

Term sheets may be binding on exclusivity and fees even before full docs sign. Distinction matters for press and employee communication.

Why it matters

• Founders: Do not spend cash or promise hires based on signing alone until you know closing certainty and wire timing.
• Investors: Signed-but-not-closed deals sit in pipeline reporting; LPs care about fall-through rates and condition risk.

Common mistake

Announcing “we closed our round” at signing when funds have not wired and charter amendments are not yet filed — employees and vendors may assume immediate liquidity.

Related ideas

• Signing vs Closing
• Break-up fee
• Conditions precedent in SPAs