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  • Numerical Example: SAFE, cap and discount - FundersClub
    Investor has purchased a safe for $100,000 The Valuation Cap is $8,000,000 and the Discount Rate is 85% The company has negotiated with investors to sell $1,000,000 worth of Series A Preferred Stock at a $10,000,000 pre-money valuation
  • Understanding SAFE Agreements: Benefits And Risks For Startups - Forbes
    The higher the discount rate, the more equity SAFE investors would receive for their investment The discount rate is clearly stated in bold at the top of the agreement
  • SAFE Financing – Valuation Cap vs. Discount Variants
    **If you are using the Discount SAFE variation, please be careful to complete the discount variable accurately! The SAFE form uses the term “Discount Rate,” which means the price AFTER the discount has been applied So, if you have a 20% discount, the “Discount Rate” would be 80%!**
  • What You Should Know About SAFEs - Cooley GO
    SAFEs often include a discount rate (often between 10-25%) by which the price per share that the SAFE converts into is discounted compared to the price the priced round investors are paying
  • Post Money SAFE Cap and Discount Explained Line by Line - Alexander Jarvis
    Tl;dr: SAFE cap and discount version of the Y-combinator post-money SAFE financing document explained line by line explanation If you are planning on raising an angel seed round with a new post-money SAFE you need to know what is in the legal agreement You aren’t a lawyer, so I’m going to explain the whole document in simple English
  • Discount Rate Dynamics in SAFE Investment Agreements
    For investors, SAFE agreements offer a straightforward path to equity in a potentially successful startup, with the discount rate providing a mechanism to compensate for the early risk When delving deeper into the mechanics of SAFE agreements and discount rates, several key points emerge: 1
  • Founder’s Guide: SAFE - Westaway
    Note that in the fall of 2021, Y Combinator removed number three, the SAFE: Valuation cap and discount from their website (without explanation) However, it remains a popular version of SAFE The SAFEs are easy to use off the shelf with minimal amendment
  • SAFE Caps and Discounts: Setting the right terms for your round
    As opposed to setting a cap, discounts are most appropriate for startups with front-loaded risk and uncertainty, such as hardware, biotech or deeptech While about 30% of SAFEs include both a cap and a discount, to assure investors they will get favourable pricing at conversion, it doesn’t make a lot of practical sense
  • Simple Agreement for Future Equity (SAFE) - Financial Edge
    Discount rates are the percentage discount to the price of shares that a seed stage investor can purchase in the next priced round





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