Entrepreneur has a great article today by Bo Yaghmaie of Cooley LLP on the basics of liquidation preferences. This is a must read for any entrepreneur negotiating with venture capitalists, as it gives the basic questions you need to ask to avoid leaving money on the table. Specfically, Yaghmaie is clear that 1X liquidation preference is standard, and that multiples are not.
Besides the multiple of the liquidation preference, entrepreneurs need to focus on whether the preferred stock is participating or non-participating, as that is a detail that is often overlooked and greatly affects the economics of the deal. If it is participating, then the entrepreneur should try to push for a cap.
So in summary, if you are negotiating a term sheet, be crystal clear on (1) the liquidation preference multiple, (2) participating or non-participating, and (3) caps on particpation. For details, go read Bo Yaghmaie's article.