Thanks for the response Kristy. You are absolutely correct that there are ways to fix these problems if you have good lawyers (and leverage). But in my experience this rarely happens. Conversely, I see the default conversion into the same new share class all the time (as a result of negotiation leverage or just because nobody involved knows any better). How does that compare to your observations with your obviously much larger portfolio? For example, what percentage of yc companies using SAFE did the pref+common conversion that you described?

Of course the other concern is that you actually have to be cognisant of this issue - or have a lawyer who is - to catch it. Maybe the SAFE could just mandate the pref+common conversion?

Do you foresee YC Safe equivalent of Series A docs? One that standardizes the terms, and reduces the time/price in the process?

At Series A, you are talking about a lot more money and a lot more company history. So VCs have an incentive and the information to price and negotiate terms. And at that point, it's best to have a good startup lawyer on your side of the table because the terms will be many. A Safe is like training wheels for the complexities Series A will bring.

Really, no one has said it, but one of the few remaining competitive advantages of Silicon Valley is the legal talent available here. While I read Venture Hacks and Brad Feld as much as anyone, I'll get a good lawyer when/before I get to A.

Similarly, LLC's can be a simple stepping stone to Delaware C. Also, provisional patents are a stepping stone to a full application. Along with Safes, these allow people to move forward without the complexity and cost of completeness.

>one of the few remaining competitive advantages of Silicon Valley

few->many