SAFE Note Dilution Calculator
Model what happens to your SAFE notes at a priced round — valuation cap, discount rate, pre-money vs post-money conversion, and the actual dilution founders take.
| SAFE Conversion | |
| Conversion Trigger | — |
| Effective Conversion Price/Share | — |
| SAFE Shares Issued | — |
| Priced Round | |
| New Investor Price/Share | — |
| New Investor Shares | — |
| Pool Top-Up Shares | — |
| Post-Round Cap Table | |
| Founder/Common Shares | — |
| Total Shares Outstanding | — |
| Post-Money Valuation | — |
How SAFE Notes Convert at a Priced Round
A SAFE (Simple Agreement for Future Equity), invented by Y Combinator in 2013, is a contract that lets early-stage investors put money in now in exchange for shares to be issued at the next priced equity round. Until that round happens, no shares exist, no interest accrues, and no maturity date forces conversion. When the priced round closes, the SAFE converts at the better of two prices: the valuation cap divided by company shares (the "cap price") or the new round's price-per-share with a discount applied.
According to Y Combinator's published documents (source: ycombinator.com/documents), a "post-money SAFE" — the standard since 2018 — gives the SAFE holder a fixed percentage of the company at conversion regardless of how many other SAFEs exist. The older "pre-money SAFE" had a moving target: when more SAFEs were issued, all SAFE holders' percentages diluted. Most companies and investors now use post-money SAFEs because they're cleaner.
Valuation Cap vs Discount — Which One Triggers
SAFE conversion uses the better-of-two prices for the SAFE holder. The cap price is calculated as the valuation cap divided by fully-diluted shares before the round. The discount price is the new round's price-per-share multiplied by (1 - discount rate). The SAFE holder converts at whichever produces more shares per dollar invested. If the priced-round valuation comes in below the cap, the discount usually triggers (rare for hot deals); if the round prices well above the cap, the cap triggers (the common case for successful startups).
For example: $1M SAFE with $8M cap and 20% discount, priced round at $12M pre-money. Cap price = $8M / 10M shares = $0.80. Discount price = $12M / 10M × 0.80 = $0.96. Cap wins ($0.80 < $0.96), so SAFE holder gets 1,250,000 shares for their $1M — versus only 1,041,666 if cap hadn't existed. To compare against convertible notes, see business loan calculator or other startup-finance tools at B2B leadgen hub.
The Option Pool Trick — Pre-Money vs Post-Money Pool
Most term sheets require expanding the option pool to a target level (typically 10-20% post-round). The crucial detail: the pool refresh is usually pre-money, meaning the dilution comes out of founders' shares, not the new investor's shares. A 15% post-money pool, refreshed pre-money, can take 5-10 percentage points off founder ownership beyond what the new money itself would dilute.
Founders often miss this in deal modeling. A "$3M on $12M pre-money" round actually dilutes founders from 100% to roughly 70% when you include both the $3M check and the pool refresh — substantially worse than the headline 20% dilution math suggests. This calculator does the full waterfall.
SAFE Stacking — When Multiple SAFEs Convert Simultaneously
If you've raised multiple SAFEs at different caps and discounts, each converts at its own cap/discount math. Earlier (lower-cap) SAFEs get more shares per dollar than later (higher-cap) SAFEs. Founders often raise the bridge at progressively higher caps — but if each SAFE has a low cap relative to the priced round, stacking can dilute founders much more than expected. Run scenarios for each SAFE's conversion separately to see the cumulative dilution.
Last updated May 2026. Sources: ycombinator.com, sec.gov.