The Complete Breakdown on SAFEs by Type and Terms

The complete breakdown on SAFEs - by type, terms, and round size.

All 37,000+ SAFEs in this analysis were signed before the company raised any priced funding. So "pre-seed", although some involved in hefty rounds that some would call seed rounds.

Overall, 80% of SAFEs over the past two years on Carta have been post-money. It's the default from YC these days, and although it is a little more investor friendly it's a great option.

𝗛𝗶𝗴𝗵𝗹𝗶𝗴𝗵𝘁𝘀: 𝗣𝗼𝘀𝘁-𝗠𝗼𝗻𝗲𝘆

• Valuation cap with no discount is the most popular SAFE within the post-money tier.

• Slight shift away from adding a discount alongside the val cap for smaller SAFE raises over the past year.

• Basically nobody gets an uncapped, un-discounted SAFE

𝗣𝗿𝗲-𝗠𝗼𝗻𝗲𝘆

• Far more people use the val cap + discount version, a departure from the post-money distributions. This pattern is even more pronounced with bigger SAFE rounds.

The big remaining question from my end: why aren't more SAFEs signed with only a discount and no valuation cap?

One of the original points in the argument for the SAFE is that it allows early angels and founders to avoid explicitly setting a valuation since that can be a fool's errand with such early companies.

Now, I know that often the cap is treated like a valuation in discussions. But kinda shocked that more people don't just lock in a 20-30% discount and call it a day. Perhaps it's not enough advantage for the angel investor, but there's a risk the next raise won't even hit the val cap!

Perhaps someone can educate me on the relative unpopularity of the discount :)

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#cartadata #SAFEs #founders #fundraising #preseed