Fundamentally, SAFE and KISS notes are convertible security notes, under which the investor is promised the future equity in the company at a lower valuation than that of the financing round’s valuation of the company such that the investor pays a lower price per share. In essence, it aims to reward the investor for having confidence in and taking the risk of investing early in the company.
Broadly speaking, SAFE is a strict conversion note, while KISS takes on the characteristics closer to a convertible loan note, but the table below highlights the essential, specific differences. That being said, do note that both notes can be varied and have terms changed to differing extents.
Whether you’re a startup, investor, or a VCC, you might need convertible notes as a vehicle to obtain initial financing from Investors.
Related read: Why the Variable Capital Company (VCC) is a Global Game Changer
Learn more about the differences between these model convertible investment documents by comparing the following factors:
- Variations
- Valuation Cap
- Discount
- Interest
- Maturity Date
- Most Favoured Nation (MFN)
- Prepayment Option
- Conversion Trigger
- Sale of Company
- Insolvency/Dissolution
- Rights
- Representations
- Transfer of Note
- High-Resolution Fundraising
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