Convertible Note & SAFE Calculator
Conversion Price:$1/share
Shares Issued:500,000
Ownership:4.76%
At Valuation Cap
Conversion Price:$1
Shares Issued:500,000
Ownership %:4.76%
Effective Valuation:$10,000,000
With Discount
Conversion Price:$2
Shares Issued:312,500
Ownership %:3.03%
Effective Valuation:$16,000,000
Most Favorable
Conversion Price:$1
Shares Issued:500,000
Ownership %:4.76%
Effective Valuation:$10,000,000
MOST FAVORABLE
- Valuation cap becomes effective when the round valuation exceeds $10,000,000
- At valuations below $12,500,000, the 20% discount provides better terms
- Maximum ownership achieved: 11.11%
- Every $5M increase in valuation reduces investor ownership by ~0.0%
Founders8,000,000 shares80.00%
Employees1,500,000 shares15.00%
Existing Investors500,000 shares5.00%
Founders8,000,000 shares66.67%
Employees1,500,000 shares12.50%
Existing Investors500,000 shares4.17%
SAFE Holder500,000 shares4.17%
New Round Investors1,500,000 shares12.50%
Founders-13.3%
Employees-2.5%
Existing Investors-0.8%
Multiple Instruments Stack
Model multiple SAFEs and convertible notes to see their combined impact
Convertible Instrument Best Practices
- Post-Money SAFEs are more founder-friendly as they provide certainty about dilution
- Valuation caps reward early investors but can cause significant dilution if set too low
- Discount rates typically range from 15-25%, with 20% being standard
- Interest on notes compounds dilution - a $500K note at 6% for 18 months adds $45K to conversion
- Multiple instruments can stack up quickly - track total dilution carefully
- Consider setting caps at 2-3x your current valuation to balance investor upside with founder dilution
