How do you account for a SAFE Agreement on a Cap Table
A company raised $525,000 through a SAFE agreement, but due to the uncertainty of future share conversion amounts, the finance team temporarily recorded the funds as an investment item. Based on its existing cap table, this article analyzes how the SAFE is presented in the table and points out potential information distortion and subsequent adjustment needs that may arise from this treatment.
We just raised $525K using a SAFE agreement and I am wondering how it should show on the Cap Table since we cannot calc the number of shares. For the momemt I just put the amount under Investment. The current Cap Table is the following: Type No. of Shares % Own Investment Series A 3,771,620 19.1% $3,000,000 Common Stock 1,695,873 8.6% $109,915 Common Stock - Founders 10,000,000 50.6% $10,000 Employee Options Distributed 3,042,346 15.4% SAFE $525,000 Available Options 1,240,341 6.3% Fully Dilluted 19,750,180 100.0% $3,644,915