
Why SAFE notes are not safe for entrepreneurs - bookbild
https://techcrunch.com/2017/07/08/why-safe-notes-are-not-safe-for-entrepreneurs/?ncid=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29
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nostrademons
I've heard similar sentiments expressed through the Valley grapevine, but
IMHO, they're misplaced. The culprit isn't SAFE notes, as a deal structure.
The culprit is entrepreneurs who treat SAFE seed rounds as an inexhaustible
piggybank that will tide them over until Series A.

Founders need to realize that if they had to take 3 seed rounds over 3 years
totaling $2M in capital to get to a pre-money valuation of $5M, that's _really
bad_. Your investors might as well have invested in Google stock. In previous
fundraising climates, that would've been a dead company, so still owning 25%
after that is an improvement, at least insofar as owning a slow-growing small
business is an improvement over being an employee.

