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Board OntologyFundraising

Outstanding Convertible Amount

Total principal value of SAFEs and convertible notes outstanding that have not yet converted to equity. These convert at the next priced round, typically at a discount or valuation cap (per the standard Y Combinator SAFE templates and the National Venture Capital Association convertible-note model). Common pitfall: a SAFE stack quietly accumulating between rounds can convert into 15–25% dilution at the next priced round, surprising founders who modeled "we only sold 10% in this priced round" math. Boards should always see the fully-diluted cap table including SAFE conversion. — Fundraising KPI anchored to Y Combinator Post-Money SAFE (2018+ standard form).

Rogue ID: fundraising.convertible_outstanding Type: Currency Domain: Fundraising

Definition

Total principal value of SAFEs and convertible notes outstanding that have not yet converted to equity. These convert at the next priced round, typically at a discount or valuation cap (per the standard Y Combinator SAFE templates and the National Venture Capital Association convertible-note model). Common pitfall: a SAFE stack quietly accumulating between rounds can convert into 15–25% dilution at the next priced round, surprising founders who modeled "we only sold 10% in this priced round" math. Boards should always see the fully-diluted cap table including SAFE conversion.

Formula

Sum of principal outstanding on all unconverted convertible instruments (SAFEs per the Y Combinator post-money SAFE template; convertible notes per the NVCA Model Documents). Pre-conversion — actual dilution depends on the next-round price and the SAFE caps/discounts.

Why it matters

Hidden dilution that hits at the next priced round. A material SAFE stack changes the math on what a "20% Series A" actually costs the founders.

How to interpret

When convertible_outstanding is more than ~10% of the company's next-likely post-money valuation, the board should require a fully-diluted cap-table walk-through at the next priced round modeling exercise. Highest-cap and lowest-cap SAFE conversion paths should both be modeled.

  • fundraising.pre_money_valuation
  • fundraising.post_money_valuation
  • fundraising.founder_dilution

Source

Y Combinator Post-Money SAFE (2018+ standard form) · section: Post-Money SAFE — Definitions (Purchase Amount) — published 2018-09-01.

Why does this cite Y Combinator Post-Money SAFE (2018+ standard form)? Read the ontology methodology for the published vs editorial tier system, attribution rules, and dispute process.

Stage relevance

Company stagePriority
Pre-SeedCore
SeedCore
Series ARecommended

Suggested for stages: Pre-Seed, Seed, Series A.

Default owning functions

  • Finance

Machine-readable

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