Glossary · Fundraising instruments
SAFE
SAFE stands for Simple Agreement for Future Equity. It is a short contract where an investor gives cash now and gets shares later, usually when you raise a priced round.
Related: Post-money SAFE · Valuation cap · Convertible note · Priced round · MFN clause (most favored nation)
A bit more nuance▾
- A SAFE is not a loan you have to pay back like a mortgage — it converts to equity on a future trigger.
- Y Combinator popularized the form; always read your specific document.
Go deeper▾
Discussion questions▾
- What happens to early supporters if your next round is much lower than you hoped?
- Who on your cap table actually understands the SAFE you signed?
Educational reference only — not legal, tax, or investment advice. Terms vary by country and deal; ask a qualified professional when it matters.