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An interesting experiment might be to reverse The everyday sequence on the discussion. As an alternative to starting off with a proposal for convertible notes after which transitioning to a SAFE composition, Let's say startups took the strategy of claiming:

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The perfectly-comprehended proposition for convertible notes is that they need to convert before maturity. Convertible notes ended up at a person level additional explicitly referred to colloquially as “bridge notes,” signaling the expectation the expenditure was remaining produced upfront of the progressing or a minimum of in the vicinity of-expression equity funding. (They may have since taken on a more enduring character.)

This is probably not the situation with a Risk-free, which seems to be more like an option. If so, the investor’s tax Keeping period starts only on “training” in the Secure (i.e., conversion of your SAFE into most well-liked stock).

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