Agreements
Fill in Y Combinator's SAFEs and side letters, or the Series Seed documents, and send them for signature.
The Library's fundraising agreements are Y Combinator's post-money SAFEs and pro rata side letters, and the Series Seed term sheet, investment agreement and restated certificate of incorporation. Their wording is the publisher's, unchanged, and your answers fill in their blanks. A SAFE goes to the company's officer and the investor to sign through E-Signatures.
Get started freeWhat a SAFE is
A SAFE (Simple Agreement for Future Equity) is an agreement between a company and an investor. The investor pays the purchase amount now, and the SAFE converts into shares when the company next raises a priced round. It is not a loan: it has no interest and no maturity date.
The Library's SAFEs are copied word for word from the forms Y Combinator publishes, under a Creative Commons Attribution-NoDerivatives licence. Y Combinator asks you not to publish a modified SAFE without asking them first.
Which SAFE to use
The Canada, Cayman Islands and Singapore forms state amounts in US dollars. Y Combinator asks that you get advice from a lawyer licensed in that country before relying on them.
- Valuation cap, no discount
- For a US corporation. The SAFE converts at a price set by the valuation cap.
- Discount, no valuation cap
- For a US corporation. The SAFE converts at the priced round's price less the discount.
- Uncapped MFN
- For a US corporation. No cap or discount; the investor can take the better terms of a SAFE or other convertible security the company issues later.
- Pro rata side letter
- Signed alongside a valuation cap SAFE: the investor's right to buy their share of the next priced round.
- Canada
- A SAFE and side letter for a corporation incorporated under the laws of Canada or of a province or territory.
- Cayman Islands and Singapore
- A SAFE and side letter for a Cayman Islands exempted company, and for a private limited company incorporated in Singapore.
What a SAFE asks
Download a sample PDF, in the More menu of a SAFE's page in the Library, shows a finished one before you start.
- Company name
- The company's exact legal name, as registered. The US and Canada forms also ask where it is incorporated, and the Singapore form asks for its registration number (UEN).
- Purchase amount
- What the investor pays now, in US dollars.
- Post-money valuation cap
- The company value used to set the price per share when the SAFE converts.
- Discount
- The discount on the price per share, such as 20 for 20%. The SAFE prints its Discount Rate as 100 minus the discount, as its blank asks.
- Date of the SAFE
- The date the investor pays. A side letter is dated on or about the same day.
- Governing law
- The state or province whose laws govern the SAFE. The Cayman Islands and Singapore forms name their own.
Who signs a SAFE
Send for signature creates an E-Signatures request with the company and the investor as signers, each with their own link at the email address entered for their party. When Personal or the team has started the same SAFE before, the company's answers from the most recent one are filled in, so a SAFE for the next investor starts with them.
- The company
- The officer you name in Signed for the company by, with their title.
- The investor
- The investor, or for a firm, the person you name in Signed for the investor by.
- Email addresses
- A SAFE prints the parties' addresses and email addresses on its signature page. A side letter does not print the email addresses.
Series Seed documents
Series Seed's documents are for selling Series Seed Preferred Stock in a seed round. They are release 3.2 (May 2014), published by Fenwick & West and dedicated to the public domain under CC0. Their wording is unchanged, including the publisher's own mistakes, and the publisher asks every party to get advice from a licensed attorney.
- Term sheet
- The one-page summary of terms: the amount raised, the pre-money valuation and option pool, board seats and the investors' rights. Its signature blocks have no signature line, so it is filled in and downloaded, not sent for signature.
- Investment agreement
- The terms, the cap table definitions and who invests. The company, two Key Holders and one purchaser sign it.
- Restated certificate of incorporation
- Replaces a Delaware corporation's charter and creates Series Seed Preferred Stock with its rights. One officer signs it, and the company files it with the Delaware Secretary of State.
Not legal advice
Magpie fills in the standard text with your answers. It is not legal advice: Magpie is not a law firm, is not acting as your lawyer, and does not check that an agreement suits your situation or can be enforced where you are. Have a lawyer review an agreement before anyone signs it.
Fill in a SAFE.
Create a Magpie account, open Agreements and start a SAFE from the Library's Fundraising group.