What are SAFEs?

A SAFE (Simple Agreement for Future Equity) is a way to raise early capital without agreeing on a full valuation for the company today. The investor gives you money now in exchange for the right to receive shares later, usually at your next equity round.

Why founders use SAFEs

• Simple, standard documents with fewer moving parts than a full-priced round.

• No interest rate or maturity date, unlike a traditional convertible note, which reduces pressure to repay in cash.​

• Faster to close with early believers when it is still hard to price the company.

Mantle helps you centralize all your SAFE investments, understand how they will convert, and see their impact on future founder ownership before you sign the next one.

Key concepts to know

Valuation Cap

The maximum company valuation used to calculate the SAFE’s conversion price. The lower the cap, the more equity that SAFE will convert into at the round.

Discount

A percentage discount on the round price (for example, 20%), giving early SAFE investors a better price than new investors.

Pre-money vs. Post-money

Pre‑money SAFEs tie into the company value before new money, which can make dilution harder to predict.

Post‑money SAFEs make each SAFE’s ownership more explicit but can “stack up” dilution quickly if you issue many.​

Conversion Trigger

Usually your next priced equity round above a certain size; sometimes also major secondary sales or a sale of the company.

Before you start issuing SAFEs

You should have:

• Lawyer‑approved SAFE templates (often based on YC’s or a local market standard).

• A simple internal view of your SAFE “policy”: typical cap ranges, whether you use discounts, and whether you prefer pre‑money or post‑money.

• A single source of truth for your cap table so you can see cumulative dilution, including existing SAFEs and option pool.
  
  

It's easy to say "yes" to SAFEs when cash is tight; Mantle's modeling makes clear what those decisions mean for your future ownership.

Recording a SAFE in Mantle

1. Add the investor

   Create or select the stakeholder who signed the SAFE.

2. Enter the SAFE details

3. Attach the signed SAFE

   Upload the executed document. Mantle's AI can help extract the key terms and map them into structured fields, reducing manual entry risk.

How SAFEs appear on your cap table

Before conversion

Mantle shows SAFEs in a dedicated section so you can easily see total SAFE dollars and their potential ownership on a fully diluted basis.

At conversion

When you close a priced round, Mantle helps you model how each SAFE converts using caps, discounts, and the round terms, then turns them into actual share records once finalized.

Things founders should watch for

• Keep a running picture of all SAFEs. Don't track some in spreadsheets and some in Mantle, or you risk underestimating dilution.

• Be intentional with valuation caps and post-money SAFEs; each new SAFE shrinks the slice of the pie left for founders and employees.

• Watch your option pool: many term sheets expect the pool to be increased before new investors come in, which, combined with SAFEs, can significantly reduce founder ownership.

If you're unsure how a new SAFE will affect you, use Mantle's scenario modeling before sending the doc out for signature.