Simple Agreements for Future Equity - YCombinator
Description
This web article describes the unique benefits of a SAFE (simple agreement for future equity), a funding mechanism sharing similarities to a convertible note that was created and pioneered by YCombinator. A SAFE is supposed to be easier to execute, due to a simple legal structure, does not saddle the startup with debt with a time limit, unlike a convertible note, and converts into preferred stock at the first priced round. The article provides links to 4 different types of SAFEs that can also be found as resources in the Founder's Playbook.
Credit: YCombinator
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