So, you three want meto invest my money into your startup. Let’s see.

I’ll give you XXXXXX$ («Purchase amount»/PA)while i think your startupis worth YYYYYY$(«Valuation Cap»/VC)

Superb!

What should we give in return?

$$$

PURCHASE

AMOUNT

You should give me eitherSAFE Preferred Stock or return me my Purchase Amountwhen certain events happen.

What arethose events?

2. Liquidity Event

1. Equity Financing 3. Dissolution Event

Follow me through theseportals, and I will show youthose events.

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1. Equity Financing

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Equity Financing is when another Investor invests moneyin your startup. In this situation, my SAFE Priceper share can be calculatedin 2 ways.

PME>VC PME

<VC

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TO BE GLORIOUSLY CONTINUED>>>

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PRE-MONEY VALUATION

At this point in time, your company willalready have a Pre-money valuation.PMV is a sum of a price of your companywith all the investments made up tothe moment of issuing preferred stock.

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VC

PMV

If the Pre-money valuation is higher compared to Valuation Cap we discussed in the beginning, than to count my price per share, we need to divide the Purchase amount on Valuation Capdivided on Company Capitalisation (a number ofall outstanding shares).Simply said:SAFEprice = PA ÷ VC ÷ CC

VC

PMV

If the Valuation Cap is higher compared to Pre-money valuation, than to count my price per share, we need to divide the Purchase amount on Pre-money valuationdivided on Company Capitalisation (a number ofall outstanding shares).Simply said:STANDARTprice = PA ÷ PMV ÷ CC

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1. Equity Financing

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Now, when you know, how tocount my price per share withinthe event of Equity financing,let’s return and continue our journey to the other portals!

PME>VC PME

<VC

See ya, guys!

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