A SAFE (Simple Agreement for Future Equity) is an investment that turns into shares at your next priced round, at a price set by a valuation cap, a discount, or both. A convertible note works the same way but is debt: the investor has a claim to be repaid, there is a maturity date, and it usually accrues interest that converts too. In Equidam you record each one in the SAFEs & Ownership tab and see what it converts to. The cap basis, pre-money or post-money, changes the ownership the investor receives.
How do I add a SAFE or convertible note?
Open SAFEs & Ownership in the sidebar.
In Current SAFEs & Notes, click Add a SAFE or note.
Fill in the fields below and click Add instrument. The next-round model updates.
Type: Post-money SAFE (the default), Pre-money SAFE or Convertible note.
Investor name: required. It suggests names from your cap table; any name is accepted.
Amount invested: required, greater than 0.
Signed date: required, defaults to today. It decides which instruments count as signed later, and the default interest start.
Valuation cap: optional; leave it empty if uncapped. If filled in, it must be greater than 0.
Discount: optional, from 0 to 100%.
Most Favoured Nation and Pro-rata right: checkboxes, off by default.
Convertible notes only: Valuation cap basis, Interest rate (per year) (optional, 0 to 100%) and Interest start date (defaults to the signed date).
Add instrument stays greyed out until both required text fields are filled in.
Pre-money or post-money cap: which should I choose?
Choose the basis your agreement states. A post-money cap fixes the investor's percentage: they own the amount divided by the cap of the company after conversion, however much else converts. A pre-money cap is a claim measured before conversion, so pre-money instruments dilute each other and are diluted alongside your existing shareholders.
For SAFEs, the type carries the basis. Post-money SAFE is the standard Y Combinator (YC) SAFE since 2018; Pre-money SAFE is the original. For a convertible note, you choose under Valuation cap basis: Pre-money (standard note), the default, or Post-money (cap fixes the investor's percentage, like a post-money SAFE). Notes saved before this option existed are treated as pre-money.
Example: a note of 500,000 at a 5,000,000 cap, 10% yearly interest, 12 months old, with no new money, gives the investor 11.0% on a post-money basis and 9.9% on a pre-money basis. Equidam shows no error for a wrong basis, so check your paperwork.
The basis also decides who pays for a larger option pool at the next round: by default, existing shareholders and pre-money instruments, not post-money ones.
How does a SAFE convert in Equidam?
Each instrument converts at whichever valuation gives the investor more shares: the valuation cap, or the round's pre-money valuation multiplied by (1 − discount). With neither a cap nor a discount, it converts at the round's pre-money valuation.
The claim is the converted amount divided by that valuation. For post-money instruments, that is a fixed share of the company after conversion. Pre-money instruments are resolved together: each claim is scaled by 1 ÷ (1 + the sum of all pre-money claims), and existing holders take the rest. New money then dilutes everyone by round size ÷ (pre-money valuation + round size).
Two worked examples:
Cap applies: a post-money SAFE of 500,000 at a 5,000,000 cap converts to 10%. After a 2,000,000 round at 8,000,000 pre-money, it holds 8.0% and a sole founder holds 72.0%.
Discount applies: a SAFE of 600,000 with a 6,000,000 cap and a 25% discount, in a round at 4,000,000 pre-money. 0.75 × 4,000,000 = 3,000,000 is below the cap, so it converts to 600,000 ÷ 3,000,000 = 20% before the new money.
Interest on convertible notes is simple interest counted in full months from the Interest start date to today: amount × (1 + yearly rate ÷ 12 × months). Accrued interest converts with the principal and shows next to the amount in the register. With no rate or 0%, the note converts on principal.
Most Favoured Nation (MFN) lets an investor take better terms signed later. Equidam checks only instruments in your register signed after the MFN instrument, and applies the cap and discount that give it the most ownership.
A pro-rata right lets an investor buy into the next round to keep their percentage. It applies only when you tick Assume pro-rata rights are exercised; the holder then buys its post-conversion share of the new round, out of the new investors' allocation.
Where do I see what my SAFEs convert to?
Enter a Round size in the next-round section and a sentence states what your SAFEs convert to and how founders are diluted. Below it:
Pro-forma cap table: each holder Today and After the round, with converted instruments marked new.
How this converts: the calculation for each instrument, including which term applied and any accrued interest.
Ownership across valuations, At exit and Market benchmarks: charts of the split, exit payouts and your terms against the market.
The conversion runs at the Low, Equidam and High points of your valuation range, or a Custom pre-money. Without a completed valuation, you type the pre-money valuation yourself.
How do I edit or delete a SAFE or note?
Click the pencil icon on the row, change the fields and click Save changes. To delete, click the trash icon and confirm with Remove (Keep it cancels). Deleting is permanent, with no undo.
Every saved instrument converts in the model. Once one has turned into shares, remove it and record the shares under Current Shareholders, or it converts twice.
To test an unsigned term sheet, use Add a hypothetical SAFE. It stays in the current scenario and is not saved to your register.
Limits
SAFEs & Ownership has no plan lock in the sidebar, and the instrument register has no plan check.
Results are percentages; share counts are not calculated.
The exit view assumes everyone participates pro-rata. Liquidation preferences are not modelled.
If your instruments would convert to more than 100% of the company at the selected valuation, a warning suggests a higher valuation or checking the amounts.
Convertible rounds imported from your funding history bring only amount and date; add the cap and discount yourself.
Common questions
Is a post-money convertible loan agreement (CLA) without interest a SAFE or a note?
A convertible note. Pick Convertible note, set the cap basis to post-money and leave the interest rate at 0. The repayment claim and maturity date make it debt, whatever the rate.
Which wins, the valuation cap or the discount?
Whichever gives the lower conversion valuation, and so more shares. How this converts names the term that applied.
Why is there a warning next to my cap?
Your cap is below 0.9× or above 1.2× your current Equidam valuation, the typical range. It is context for negotiating, not a verdict: caps are agreed case by case.