Series Seed · SANE Edition · Open Source
SANE — Simple Agreement for Now Equity
You've outgrown the SAFE. You're not ready for a full NVCA round. SANE sits in the middle — real preferred equity, a clean cap table, and a working board, without the hundred-page overhead.
Where SANE fits
Fast and flexible for early pre-seed checks where pricing is premature. But it defers governance, creates conversion uncertainty, and doesn't start the QSBS clock.
Three documents. Real preferred stock. A functional board. QSBS eligibility at closing. Designed to close in days, at a cost closer to a SAFE round than a Series A.
The gold standard for Series A and beyond. Five documents, a month to close, $50K+ in legal fees — built for companies that have already confirmed product-market fit.
SANE gives you the structure of a priced round without the overhead. Everything you negotiate is what you get — no stacking, no dilution math that only resolves at your next raise.
With priced equity, the cap table is clean and final at closing. No stacked SAFEs at different caps, no conversion surprises when the next round lands.
SAFEs defer governance entirely. SANE gives you designated board seats — founder, investor, and mutual consent directors — from day one.
SAFE stacking creates invisible dilution that only materializes at your next raise. Priced equity eliminates the conversion event entirely. What you negotiate is what you get.
NVCA-aligned documents mean your Series A starts from solid footing. Next-round counsel can redline SANE against the NVCA model and immediately see the delta — no archaeology.
SAFE investors arguably don't start the QSBS clock until conversion — a question the IRS hasn't resolved. SANE preferred stock starts it at closing, and comes with the governance rights SAFEs never provide.
Preferred stock purchased at a priced round starts the Section 1202 clock at closing. For investors targeting the QSBS exclusion, that timing difference can be worth millions.
SAFE investors can't cleanly calculate their ownership, liquidation waterfall position, or pro rata. With priced equity, every investor knows exactly what they own.
Board representation, information rights, participation rights, and consent rights over actions that matter — none of which SAFEs provide.
If the company subsequently issues equity on more favorable terms, SANE investors are entitled to equivalent rights. Major Purchaser status carries forward to the next round.
SAFEs remain the right tool when pricing is genuinely premature, the check is small, and governance can wait. SANE is for what comes next.
Open source and free to use. Download the Word documents and use the Variable Reference Map to track cross-document dependencies before you sign.
Non-binding summary of principal deal terms. Start here to align with your lead investor on economics, board composition, and key provisions.
Download .docxSingle binding document covering purchase mechanics, representations, information rights, participation rights, voting, and general provisions.
Download .docxRestated Delaware charter defining stock rights, conversion mechanics, liquidation preferences, and protective provisions. Files with Delaware at closing.
Download .docxAll documents are on GitHub in Markdown and Word formats. Found an error or have a suggestion? Open an issue or submit a pull request.