SAFE Valuation Cap? or Discount? Both? It depends on where you are.
There are lots of important terms to know when raising on SAFEs, but the most critical are the valuation cap and the discount.
Different VC ecosystem have their own patterns for those two terms. In Silicon Valley, 70% of pre-seed fundraising on SAFEs happen with a valuation cap and no discount.
In Seattle, it's about 50/50 between valuation cap, no discount and valuation caps with a discount.
In Chicago, a discount of some type appears in about 80% of SAFEs.
These can greatly impact the eventual conversion into equity when your company raises a priced round - so be sure to use our free SAFEs calculator to model out dilution before you sign those SAFEs!
Happy fundraising! If you're into this sort of startup data, we have a whole new quarter to dig into next week. Sign up for the Data Minute newsletter in the first comment below to stay on top of it.
#cartadata #SAFEs #valuationcap #discounts #startups #founders #preseed
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