SAFE: Great (Esp For Entrepreneurs), As Long As Done Safely

2 min read

Simple Agreement for Future Equity, or SAFE, is an increasingly popular instrument for fundraising especially at the earliest stages of a startup. SAFEs were really formalized by Y-Combinator in late 2013 (more on their website) and is a third major alternative, aside from equity and debt. Much has been written around SAFEs, this post is focused on highlighting the biggest pros and cons with an eye on why they aren’t uniformly the best option.  1) Definitions — Think of fundraising as follows: i) Equity — An investor gives capital, you give them shares / ownership in your company. ii) Debt…...

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Amit Garg I have been in Silicon Valley for 20 years -- at Samsung NEXT Ventures, running my own startup (as of May 2019 a series D that has raised $120M and valued at $450M), at Norwest Ventures, and doing product and analytics at Google. My academic training is BS in computer science and MS in biomedical informatics, both from Stanford, and MBA from Harvard. I speak natively 3 languages, live carbon-neutral, am a 70.3 Ironman finisher, and have built a hospital in rural India serving 100,000 people.