Series Sane · 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 stock, a clean cap table, and a working board, in three documents a Series A lawyer will recognize line by line.
Where SANE fits
Fast and flexible for early pre-seed checks where pricing is premature. But it defers governance, creates conversion uncertainty, and arguably doesn't start the QSBS clock until it converts.
Three documents. Real preferred stock. A working board. The QSBS clock starts at closing. Built on the current NVCA model documents and 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, weeks to close, and legal fees that often run past $50,000, built for companies that have already found product-market fit.
Companies routinely raise $1M, $2M or $3M on stacked SAFEs when a priced round would serve everyone better. SANE gives you the structure of a priced round without the overhead. What you negotiate is what you get: no stacking, no dilution math that only resolves at your next raise, and one page of blanks to fill in.
With priced equity, the cap table is clean and final at closing. Existing SAFEs and notes convert now, on their own terms, and the surprises stop there.
SAFEs defer governance entirely. SANE gives you designated board seats (founder, investor, and mutually chosen directors) from day one, with the counts set in one table.
SAFE stacking creates invisible dilution that only materializes at your next raise. Priced equity has no conversion event. What you negotiate is what you get.
The charter follows the NVCA model charter section for section, and the agreement follows the NVCA order. Next-round counsel can redline SANE against the NVCA model and see the delta in an afternoon. No archaeology.
SAFE investors arguably don't start the QSBS clock until conversion, a question the IRS hasn't resolved. They also aren't stockholders yet, so the board's fiduciary duties don't run to them. SANE preferred stock starts the clock at closing, and comes with the governance rights a SAFE never provides.
Preferred stock purchased in a priced round starts the Section 1202 holding period at closing. The company represents its eligibility and covenants to maintain it. For investors targeting the QSBS exclusion, that timing can be worth a great deal.
SAFE investors can't cleanly calculate their ownership, their place in the liquidation waterfall, or their pro rata. With priced equity, every investor knows exactly what they own.
Board representation, consent rights over the actions that matter, and, for major purchasers, information and inspection rights, a pro rata participation right, and a right of first refusal on founder transfers. A SAFE provides none of these on its own, and until it converts the holder isn't a stockholder, so the fiduciary duties Delaware law gives stockholders don't apply either.
Broad-based weighted average anti-dilution in the NVCA form. At the next round, whatever rights go to all investors in that round go to SANE investors too, and major-investor rights are available to SANE investors who meet the threshold, counting their SANE investment. No guesswork for next-round counsel about what carries over.
SAFEs remain the right tool when pricing is premature, the checks are small, and governance can wait. SANE is for what comes next, for a Delaware corporation.
Open source and free to use. Every deal-specific term lives in the Deal Terms table at the front of the Investment Agreement, on its schedules, or in the charter blanks; the Variable Reference Map shows which numbers have to match. Board and stockholder consents and an investor questionnaire are on the way.
Two-page non-binding summary of the deal. Start here to align with your lead investor on price, board composition, and the handful of terms that matter.
Download .docxOne agreement, in NVCA order, covering the purchase, representations, investor rights, transfer restrictions, voting and drag-along. Every deal-specific term lives in a one-page Deal Terms table.
Download .docxAmended and restated Delaware charter that follows the NVCA model charter article for article, with an optional sub-series for SAFEs and notes converting below the round price. Files with Delaware at closing.
Download .docxSeries Seed began at Fenwick & West in 2010 as a three-document alternative to the five-document NVCA suite, and had not been materially updated since version 3.2. Series Sane rebuilds it on the current NVCA model documents. All documents are on GitHub in Markdown and Word formats, with drafting notes written for the people using them. Found an error or have a suggestion? Open an issue or submit a pull request.