Ask HN: Does a SAFE Constitute a Term Sheet?

[jmanooch]

I have had a pretty intense disagreement with one of my advisors regarding whether the SAFE constitutes a Term Sheet. My understanding is that it does, and that it makes no sense to supply an additional / separate term sheet. Our lawyers (solid ones) indicate a term is not additionally necessary. But the advisor has dug his heels in. Sigh.

Anyone with a call on this, esp on that is lawyer-tested?

[walkermchugh]

A signed SAFE would equate to a signed financing deal. Asking for a term sheet after the deal is signed seems... odd. We supply a SAFE summary upon execution for the investors records along with the executed SAFE.

[jmanooch → walkermchugh]

SAFE not signed yet, but thanks.

[kidlogic]

A Term Sheet is a non-binding document that highlights the details of a Financing Note (in this case, the SAFE)

[kidlogic → kidlogic]

Following up - The advisor is just being lazy and doesn't want to read the ACTUAL SAFE Note, and would prefer an abridged version (i.e Term Sheet).

[jmanooch → kidlogic]

I think that's the thing. Thank you.

[rajacombinator]

Of course it’s not necessary. Did you/advisor read the SAFE? Now it’s time to decide if your “advisor” (investor?) is bringing enough to the table to comply with his amateurish requests and handholding.

[jmanooch → rajacombinator]

I've read the SAFE and don't think it makes sense, since the SAFE is clearly its own term sheet. But the advisor I think IS being lazy by not reading it, and just wants a summary for investors.

He is very senior and not amateurish, I think the issue is he does not like SAFEs (says they are not SEC-tested) and thus I think won't read them, and thinks any deal of any sort without a summary term sheet is not 'serious'.

Thanks.

[jmanooch → jmanooch]

[I mean the advisor's comments don't make sense, the SAFE makes good sense.]