Fast, efficient early-stage capital raising with strategically structured SAFEs and Convertible Notes designed to protect founder equity.
For early-stage companies raising Pre-Seed or Seed rounds, pricing the company’s equity can be an impossible hurdle. Simple Agreements for Future Equity (SAFEs) and Convertible Notes offer a fast, cost-effective alternative to a priced equity round, allowing founders to secure capital immediately while delaying valuation until a future financing event.
While these instruments are designed to be “simple,” misunderstanding the mechanics of valuation caps, discount rates, and conversion triggers can lead to catastrophic dilution for founders down the road. At Ishimbayev Law Firm, we structure, negotiate, and execute SAFE and Convertible Note rounds that align with industry standards while aggressively protecting your cap table.
Customizing Y Combinator (YC) standard SAFEs, advising on the critical differences between Pre-Money and Post-Money formats, and negotiating Pro-Rata rights or MFN (Most Favored Nation) clauses.
Structuring debt instruments with tailored maturity dates, interest rates, and conversion mechanics (both automatic and optional) that protect the company if a qualified financing is delayed.
Providing clear, practical modeling of how different valuation caps and discounts will impact founder ownership at the conversion event (Series A).
Drafting the necessary Board of Directors resolutions and stockholder consents required to legally authorize the issuance of convertible securities.
We evaluate your current cap table and future fundraising goals to determine whether a SAFE or Convertible Note is the better instrument, establishing optimal caps and discounts.
We draft the instruments and coordinate the necessary corporate approvals, ensuring your company is legally authorized to issue the securities.
We manage the closing process, coordinate investor signatures, and file the necessary federal Form D and state Blue Sky notices to maintain your regulatory exemptions.
Standard templates often favor investors. We meticulously negotiate the hidden mechanics—such as how the “Company Capitalization” is defined at conversion—to prevent toxic, out-of-control dilution of the founding team.
Seed rounds need to close fast. We strip away unnecessary legal friction, utilizing market-standard frameworks to get signatures on paper and funds in your bank account without dragging out negotiations.
The shift to Post-Money SAFEs radically changed how dilution is calculated. We provide the strategic clarity founders need to understand exactly how much of their company they are selling before they sign.
We draft your early-stage instruments with your Series A in mind. Our clean, institutional-grade documentation ensures that when venture capital firms conduct due diligence later, your cap table and corporate records are flawless.
A Convertible Note is debt; it carries an interest rate, has a maturity date (a deadline for repayment or conversion), and sits higher in the capital structure. A SAFE does not function as debt A SAFE is not debt; it has no interest rate or maturity date, making it inherently friendlier to the company, but riskier for the investor.
A valuation cap is the maximum valuation at which an investor’s money will convert into equity during a future priced round. It rewards early investors for taking early risk by guaranteeing them a lower price per share than later investors.
Yes, you generally must file a Form D with the SEC for a SAFE or Convertible Note. SAFEs and Convertible Notes are considered securities under federal law. If you are raising money under a Regulation D exemption (like 506(b) or 506(c)), you must file a Form D and applicable state Blue Sky notices within 15 days of the first signed agreement.
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