# SAFE review
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Review YC post-money SAFEs (Simple Agreements for Future Equity) clause-by-clause for founders, investors, and counsel — covering valuation cap mechanics and…

Review YC post-money SAFEs (Simple Agreements for Future Equity) clause-by-clause for founders, investors, and counsel — covering valuation cap mechanics and Company Capitalization denominator, discount rate analysis, MFN clause triggering and scope, pro rata rights (in-form and side letter), conversion mechanics across all trigger events (equity financing, liquidity event, dissolution), amendment and majority-in-interest provisions, and non-standard modifications. Benchmarks every material term against the current YC post-money templates (v1.1/v1.2, February 2023 update) and market data (Carta Q3 2024). Classifies deviations as STANDARD / FLAG / RED FLAG with dual-perspective framing (founder view and investor view). Models ownership percentage at conversion. Identifies template drift (modifications beyond blank-filling). Reviews accompanying side letters (pro rata, information rights, board observer, MFN extension). Flags securities law compliance gaps (Reg D Form D, accredited investor verification, Blue Sky notices) and tax risks (IRC § 1202 QSBS, Section 409A timing). Produces confidence-scored, jurisdiction-aware analysis with prioritized redlines and a Glass Box audit trail. Use when reviewing, negotiating, or advising on a YC-form SAFE, any SAFE variant, uncapped MFN SAFE, discount-only SAFE, or post-money SAFE side letter at pre-seed, seed, or bridge stage. Also triggers on: post-money cap calculation, Company Capitalization definition, valuation cap vs. discount comparison, shadow preferred stock at conversion, SAFE conversion mechanics, Liquidity Capitalization, MFN notification window, pro rata side letter scope, majority-in-interest amendment, QSBS clock for SAFEs, and YC template modification detection.

This skill reviews YC post-money SAFE agreements clause-by-clause. It identifies the template variant in use, detects modifications from the standard form, benchmarks every material economic term against current market standards, and generates prioritized findings with dual-perspective framing (founder view and investor view) and actionable redlines. **Covers:** - Template identification and modification detection (standard vs. modified form; 2023 non-modification representation) - Variant classification: cap-only (v1.1), discount-only, uncapped MFN (v1.2), or non-standard cap+discount - Valuation cap mechanics: Safe Price formula, Company Capitalization denominator composition and negotiation - Discount rate analysis: discount-derived price, interaction with cap, standard vs. non-standard rates - MFN clause: trigger events, notification mechanics, election window, scope (economic terms only vs. broader) - Pro rata rights: in-form (pre-2018 only) vs. side letter; scope, formula, and perpetuity analysis - Conversion mechanics across all trigger events: equity financing, liquidity event (M&A, IPO), dissolution - Liquidity Capitalization vs. Company Capitalization distinction - Shadow preferred stock consequences at conversion - Amendment and majority-in-interest provisions: Purchase Amount carve-out, solicitation requirements - Non-standard red flags: interest rates, maturity dates, warrant coverage, board seats, consent/blocking rights - Side letter review: pro rata scope, information rights, board observer, MFN extension - Securities compliance flags: Regulation D exemption, Form ...

## Jurisdictions

Global



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