Safe, Efficient, and Compliant: A Step-by-Step Guide to Closing a Safe Financing
Simple Agreements for Future Equity (Safes) have exploded in popularity among startups and investors. These days, their use has become ubiquitous when raising friends and family, pre-seed and seed rounds due to ease of use and low cost. While simple and safe, securities, corporate laws, and the terms of internal governance documents still apply to Safes and have ever since Y Combinator first introduced the Safe in late 2013. Skipping compliance early on in any financing could delay (or even halt) future venture rounds and exit transactions due to compliance concerns discovered during due diligence.
In our experience, the main reason companies overlook Safe requirements is simply a lack of knowledge. So, we created this blog post and its corresponding checklist to help founders, accelerators, and investors access a quick but thorough, off-the-shelf checklist for Safe financings.
This checklist is not a substitute for legal counsel. Our team is available to assist companies and investors in navigating Safe financings and conversions of Safes in connection with a priced round.
