Tag: SAFE Note

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SAFE/Convertible Note vs Priced Round

Funding rounds or investments in privately held companies often raise whether the company should use a SAFE and convertible note or priced equity rounds. Each option has unique effects, demanding careful analysis. SAFE notes are popular among startups and similar to stock options, as convertible notes are debt instruments with the right to convert into … Continued

Key Terms of Convertible Notes and SAFEs

SAFE and convertible notes are great choices accessible to startups needing pre-seed or seed capital. Startups use Convertible instruments to raise financing. Choosing the right one will depend on how well you grasp the Convertible and SAFE note terms and which suits your business better. Convertible notes and SAFEs are the same instruments, differing in … Continued

SAFE Note vs Convertible Note: All You Need to Know

You might have heard the terms SAFE note and convertible note in the context of investments. SAFE note or Simple Agreement for Future Equity is a type of instrument wherein the company shares or stocks are issued to the investor after a certain period. While a convertible note is a debt instrument that can be … Continued

Is a 409A Valuation Needed for Convertible Notes or SAFE Notes?

Following the Enron scandal of 2001, the government demanded corporations correctly value stock options granted to employees. Section 409A of the tax code requires startups to undertake regular audits to determine the value of the common shares they give out as options to their employees. A firm typically completes its first 409A valuation after raising … Continued

SAFE or Simple Agreement for Future Equity Template

When starting a new company, there comes a lot of excitement to get your business ideas off the ground and start running your company. But this will eventually bring in the realization that you will need to raise money to run the company and grow. And at this point, many founders struggle to find a … Continued

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