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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
Add the investor
Create or select the stakeholder who signed the SAFE.
Enter the SAFE details
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 to mark a SAFE as converted and link to the resulting security
Go to the SAFEs section in Mantle and select the SAFE you wish to convert.
Edit the SAFE by opening the details page and navigate to Actions then Edit.
Add in a cancellation date for the SAFE and press Save.
Draft and publish the converted shares via the Draft Shares flow.
Select Shares from the left-hand menu. Click Draft Shares at the top right, and the select Draft with the pencil icon to create a new Share Issuance record
Navigate back to the SAFE’s details page and select Actions, Manage Links, and select Converted under the Event Type field.
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.