Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) is a legal document used in startup financing that outlines the terms and conditions of an investment agreement. This agreement is designed to simplify the fundraising process for early-stage companies in Puerto Rico. The Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) establishes a framework for startups to secure funding without setting an initial valuation. Instead of issuing shares or convertible notes, SAFE grants investors the right to obtain equity in the company in the future, based on predefined triggering events such as a subsequent funding round or acquisition. There are several types of Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) that vary based on the specific terms and conditions stated within the agreement. These different types include: 1. Valuation Cap SAFE: This type of SAFE allows investors to set a maximum valuation at which their investment will convert into equity. If the company's valuation exceeds the predetermined cap, the investor's equity stake will be based on the cap rather than the higher valuation. 2. Discount SAFE: A Discount SAFE provides investors with the opportunity to purchase equity at a reduced price compared to future investors. This type of SAFE offers investors a discount percentage on the price per share at which their investment converts into equity. 3. Most Favored Nation SAFE: A Most Favored Nation SAFE guarantees that if the company issues new Safes with more favorable terms, the investor will automatically receive those improved terms. This type of SAFE provides investor protection against dilution and ensures they will receive the benefit of any improved investment terms. 4. Thematic SAFE: A Thematic SAFE allows investors to choose a particular theme or industry focus for their investment. This type of SAFE caters to investor preferences by aligning their investment with specific sectors or emerging trends. The Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) serves as a flexible and efficient investment instrument, enabling startups in Puerto Rico to secure funding while deferring the complexities associated with traditional equity investments. It offers clear terms, investor protection, and accommodates various investor preferences, making it a valuable financing tool for startups in Puerto Rico.
Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) is a legal document used in startup financing that outlines the terms and conditions of an investment agreement. This agreement is designed to simplify the fundraising process for early-stage companies in Puerto Rico. The Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) establishes a framework for startups to secure funding without setting an initial valuation. Instead of issuing shares or convertible notes, SAFE grants investors the right to obtain equity in the company in the future, based on predefined triggering events such as a subsequent funding round or acquisition. There are several types of Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) that vary based on the specific terms and conditions stated within the agreement. These different types include: 1. Valuation Cap SAFE: This type of SAFE allows investors to set a maximum valuation at which their investment will convert into equity. If the company's valuation exceeds the predetermined cap, the investor's equity stake will be based on the cap rather than the higher valuation. 2. Discount SAFE: A Discount SAFE provides investors with the opportunity to purchase equity at a reduced price compared to future investors. This type of SAFE offers investors a discount percentage on the price per share at which their investment converts into equity. 3. Most Favored Nation SAFE: A Most Favored Nation SAFE guarantees that if the company issues new Safes with more favorable terms, the investor will automatically receive those improved terms. This type of SAFE provides investor protection against dilution and ensures they will receive the benefit of any improved investment terms. 4. Thematic SAFE: A Thematic SAFE allows investors to choose a particular theme or industry focus for their investment. This type of SAFE caters to investor preferences by aligning their investment with specific sectors or emerging trends. The Puerto Rico Term Sheet — Simple Agreement for Future Equity (SAFE) serves as a flexible and efficient investment instrument, enabling startups in Puerto Rico to secure funding while deferring the complexities associated with traditional equity investments. It offers clear terms, investor protection, and accommodates various investor preferences, making it a valuable financing tool for startups in Puerto Rico.
