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Convertible Note & SAFE Calculator

Model conversion scenarios and understand dilution impact on your cap table

Best Conversion Terms

Conversion Price:$1/share
Shares Issued:500,000
Ownership:4.76%

Investment Details

Principal:$500,000
Total Converting:$500,000

Founder Dilution

Before:80.0%
After:66.7%
Dilution:-13.3%

Instrument Details

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Current Cap Table

Conversion Scenarios

At Valuation Cap

Conversion Price$1
Shares Issued500,000
Ownership %4.76%
Effective Valuation$10,000,000

With Discount

Conversion Price$2
Shares Issued312,500
Ownership %3.03%
Effective Valuation$16,000,000

Most Favorable

Conversion Price$1
Shares Issued500,000
Ownership %4.76%
Effective Valuation$10,000,000
Most Favorable

Next Round Details

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Valuation Impact Analysis

Key Insights

  • 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%

Cap Table Impact

Before Conversion

Founders8,000,000 shares80.00%
Employees1,500,000 shares15.00%
Existing Investors500,000 shares5.00%

After Conversion & New Round

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%

Dilution Impact

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