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So what happens to the $375k if you don't raise after YC? Let's say you exit 1 year after YC at a $5m valuation With the MFN, does that mean that YC get 28% o
by daolf 5y ago
So what happens to the $375k if you don't raise after YC?
Let's say you exit 1 year after YC at a $5m valuation
With the MFN, does that mean that YC get 28% of the sale instead of the initial 7%?
- jonathanpeterwu 5y agoThat seems to be the suggestion with MFN, it gets priced at the lowest term sheet so in this case the sale term sheet
- rexreed 5y agoI posed the exact question here and got the non-answer that an unconverted SAFE is just debt, but it's not just debt. My understanding is that the valuation is not meaningful on an uncapped SAFE where there's no subsequent round. So 7% equity is what they have regardless of a $5M valuation as determined by... who?
- jeff18 5y agoMy understanding is that YC would get 7% ($350k) and would also receive $375k from this new SAFE. So YC would have put in $500k and gotten $675k back.