About the SAFE Note Calculator
A SAFE (Simple Agreement for Future Equity) is an investment that converts into shares at the company’s next priced round. This calculator shows how one SAFE converts: whether the valuation cap or the discount gives the investor the better deal, the conversion price per share, how many shares they receive and what percentage they own before and after the new money comes in.
It is built for founders comparing SAFE terms, angels checking what their investment is worth, and anyone preparing a cap table ahead of a seed or Series A round. You can switch between the post-money SAFE (the current Y Combinator standard) and the older pre-money SAFE, which dilutes the SAFE holder differently.
Assumptions: one SAFE (or several with identical terms, entered as a total), the round’s pre-money valuation includes the shares the SAFE converts into, and no other convertibles or option-pool increase happen at the same time. Real conversions follow the exact wording of your documents and the round’s capitalization definition.
With the default inputs, the safe ownership after the round is 4%. Change any value above to recalculate instantly.
How to use the safe note calculator
- 1Choose post-money or pre-money SAFE to match your document.
- 2Enter the SAFE investment, valuation cap and discount.
- 3Enter fully diluted shares outstanding before the SAFE converts.
- 4Enter the priced round’s pre-money valuation and new money raised.
- 5Read which term applies, the conversion price, shares and ownership after the round.
Formula and method
A SAFE converts at whichever price gives the investor more shares: the cap price or the discounted round price. With a post-money SAFE the cap is measured after the SAFE converts, so the investor owns exactly investment ÷ cap of the company just before the new round — the formula I × S ÷ (Cap − I) delivers that. With a pre-money SAFE the cap price is simply Cap ÷ S.
The priced round’s share price is its pre-money valuation divided by all shares including the converted SAFE shares; the discount path solves that relationship directly. New investors then buy shares at the round price, which dilutes everyone, including the SAFE holder, proportionally.
- I
- SAFE investment amount
- S
- Fully diluted company shares before the SAFE converts
- Cap
- Valuation cap in the SAFE
- d
- Discount rate (20% = 0.20)
- Pre
- Pre-money valuation of the priced round
Worked examples
$500k post-money SAFE, $10M cap, Series A at $20M pre
The cap gives 500k × 10M ÷ 9.5M ≈ 526,316 shares, exactly 5% before new money. The round price is $20M ÷ 10.53M shares = $1.90, so the SAFE converts at $0.95, a better deal than the 20% discount would give. After $5M of new money the SAFE holder owns 4.0%.
High cap, so the discount wins
A $30M cap is far above the $15M round, so the 20% discount gives more shares: 500k × 10M ÷ (0.8 × 15M − 500k) ≈ 434,783. The round price is $1.4375 and the SAFE converts at $1.15, ending at about 3.1% after the round.
Same terms as a pre-money SAFE
With a pre-money $10M cap the conversion price is $10M ÷ 10M shares = $1.00, giving 500,000 shares. The SAFE holder ends with 3.81% instead of 4.0% under a post-money SAFE, because the pre-money cap price ignores the SAFE’s own shares, so those shares dilute the investor as well as the founders.
Frequently asked questions
What is the difference between a post-money and a pre-money SAFE?+
In a post-money SAFE the valuation cap includes the SAFE money itself, so the investor’s stake before the next round is fixed at investment ÷ cap and founders bear dilution from later SAFEs. In a pre-money SAFE the cap excludes SAFE money, so SAFE holders dilute each other too.
Does a SAFE use the cap or the discount?+
When a SAFE has both, the investor gets whichever results in the lower conversion price and therefore more shares. A low cap usually wins when the round is priced well above it; the discount wins when the round price is close to or below the cap.
What is a typical SAFE discount?+
Discounts of 10% to 25% are common, with 20% seen frequently. Many post-money SAFEs are cap-only with no discount; enter 0% in that case.
When does a SAFE convert?+
A SAFE normally converts at the next priced equity financing. It can also pay out or convert on a sale or IPO (a liquidity event) or return money on dissolution, following the terms in the document.
Is a SAFE debt?+
No. Unlike a convertible note, a SAFE has no interest rate and no maturity date. It is a contractual right to future equity, which is why it is simpler and cheaper to issue.
Results are general estimates and not legal advice. Laws vary by jurisdiction — consult a qualified attorney.