Glossary · Fundraising instruments
MFN clause (most favored nation)
A promise that if you give a **better** deal to someone else later (lower valuation cap, bigger discount, etc.), this investor can ask to match those sweeter terms.
Related: SAFE · Convertible note · Valuation cap
A bit more nuance▾
- Common in SAFE stacks; can get messy if many investors have MFNs.
- Read what triggers the “better deal” — definitions differ.
Go deeper▾
Discussion questions▾
- How would you handle three investors all invoking MFN at once?
- What deal terms should never fall under MFN from your perspective?
Educational reference only — not legal, tax, or investment advice. Terms vary by country and deal; ask a qualified professional when it matters.