Startup Financing Terms

Learn how to understand the key terms used in startup financing documents such as Convertible Notes, YCombinator SAFE agreements, Series Seed term sheets, Series A term sheets, and late stage fundraising term sheets. Prepare yourself for negotiating about key financing and control terms when you go to raise funds from venture capitalists to grow your startup. We cover important concepts for entrepreneurs who plan on raising outside capital, such as valuation caps, discounts, liquidation preferences, dilution, anti-dilution provisions and more.

What is a Signature Block in Legal Contracts?

Most people don't pay much attention to the signature block when a contract is signed. Signature blocks and conventions around signature in legal contracts serve an essential function in determining the validity of a contract such as an investor agreement or stock option award.

by Nancy Thanki • 2 min read

Startup Fundraising: Key Differences Between SAFEs and Convertible Notes

The SAFE has become more popular as a way of financing early stage startups since its creation in 2013. But convertibles notes are still used by investors around the world. We break down key differences between SAFEs and convertible notes.

by James Hottensen • 6 min read

Priced and Unpriced Financing Rounds: What are the Differences?

The key differences between priced and unpriced rounds and when startups use them for fundraising. Learn about key financing terms like preferred shares, convertible equity, valuations and valuation caps.

by Stefan Nagey • 5 min read

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How do SAFEs Work?

How YCombinator SAFEs work for startup fundraising. An in-depth look at key terms, like valuation cap, discount, and most-favored nation (MFN) status.

by Greg Miaskiewicz • 7 min read

How Do Convertible Notes Work?

An in-depth look at convertible notes and how these financing instruments are used by early stage startups.

by Greg Miaskiewicz • 5 min read

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