SAFE Calculator

You’re investing in a startup via a SAFE. Should you take the discount or the valuation cap? Enter your deal terms below and see which one gives you more equity when the startup raises its next round.

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+$480

The Discount SAFE is worth $480 more than the Cap SAFE at $8.0M post-money ($6.0M pre + $2.0M round)

What your $10,000 investment is worth after the round

Discount
$12,480
Cap
$12,000
Without a SAFE
$9,988

Both SAFEs give you more equity than investing directly in the priced round. The Discount SAFE gives you $2,493 more than a straight equity investment.

Your inputs

Investment amount$10,000Discount rate20%Valuation cap$5,000,000Pre-money valuation$6,000,000Round size$2,000,000

Post-money valuation = $6,000,000 + $2,000,000 = $8,000,000

Assumed shares outstanding: 10,000,000 (see Assumptions below)

Discount SAFE — step by step

The Discount SAFE converts at a discounted price per share. Per the YC SAFE, Section 1(a): you receive shares at the Discount Price, defined in Section 2 as the round’s price per share × (1 − your discount).

Step 1 — Round price per share

Pre-money valuation ÷ shares outstanding

$6,000,000 ÷ 10,000,000 = $0.6000 per share

Step 2 — Your discounted price

$0.6000 × (1 − 20%) = $0.4800 per share

Step 3 — Shares you receive

$10,000 ÷ $0.4800 = 20,833 shares

Step 4 — Total shares after the round

Founders:10,000,000Your SAFE:20,833Equity round:3,333,333Total:13,354,167

Step 5 — Your ownership

20,833 ÷ 13,354,167 = 0.156%

Step 6 — Value of your stake

0.156% × $8,000,000 = $12,480

Valuation Cap SAFE — step by step

The Cap SAFE converts using a Safe Price derived from your valuation cap. Per the YC SAFE, Section 2: Safe Price = Post-Money Valuation Cap ÷ Company Capitalization. Because this is a post-money cap, Company Capitalization includes the SAFE itself.

Step 1 — Does the cap bind?

Post-money ($8,000,000) > cap ($5,000,000) — Yes, the cap binds.

This means you convert at the cap price, which is lower (better for you) than the round price.

Step 2 — Company Capitalization (including your SAFE)

The post-money cap means: your pre-round ownership = Investment ÷ Cap.

Company Cap = shares outstanding ÷ (1 − Investment ÷ Cap)

= 10,000,000 ÷ (1 − $10,000 ÷ $5,000,000)

= 10,020,040

Step 3 — Your Safe Price

(Cap − Investment) ÷ shares outstanding

($5,000,000 − $10,000) ÷ 10,000,000 = $0.4990 per share

Step 4 — Shares you receive

$10,000 ÷ $0.4990 = 20,040 shares

Step 5 — Round repriced against Company Capitalization

Because Company Capitalization is larger (it includes your SAFE shares), the equity round’s price per share is slightly lower:

$6,000,000 ÷ 10,020,040 = $0.5988 per share

Equity round shares = $2,000,000 ÷ $0.5988 = 3,340,013

Step 6 — Total shares after the round

Company Cap:10,020,040Equity round:3,340,013Total:13,360,053

(Your 20,040 shares are already inside Company Cap — don’t add them again.)

Step 7 — Your ownership and stake value

20,040 ÷ 13,360,053 = 0.150%

0.150% × $8,000,000 = $12,000

The comparison

Discount SAFE equity value$12,480Cap SAFE equity value$12,000Difference$480

The Discount SAFE wins at this valuation.

Assumptions & references

  • Shares outstanding: 10,000,000 (assumed). This is used for intermediate share calculations only. The final ownership percentages and equity values hold regardless of the actual share count — the shares cancel out in the Discount SAFE formula and resolve via the post-money cap definition in the Cap SAFE formula.
  • Based on: YC Post-Money SAFE (2018). Discount conversion: Section 1(a), Section 2 (Discount Price definition). Cap conversion: Section 1(a), Section 2 (Safe Price and Company Capitalization definitions).
  • Single SAFE holder. This model assumes you are the only SAFE holder. Multiple SAFEs converting simultaneously would change the dilution math.
  • Simplified cap table. In practice, “Company Capitalization” under the YC post-money SAFE also includes vested and unvested options, promised options, and the unissued option pool. The relative comparison — which SAFE type gives you more — holds regardless.

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