The threshold between an angel round and a series A is determined by your articles of incorporation. It's usually between 2 and 5 million. Before your series A you have no valuation b/c it would be a waste of money to determine it. Once you have matured and you raise enough money to go past the 2 to 5 million "convertible threshold," you get a valuation and issue class A stock to your investors and angels. Your angels convert from a convertible note to class A stock at the pre-money valuation and they get to ride the "valuation bump" the series A investors put in for free.

Ok, I reread this explanation and I hated it. This is how I actually understand it:

// globals

double classAThreashold = callLaywers( "Halp!" );

double outstandingShares = callLawyers( "Oh noes!" );

double amountInvested = 0;

void enterNewInvestment( double newInvestment )

{

    if( newInvestment + amountInvested >= classAThreshold ) {

        double preMoneyValuation = getValuation();

        vector< double > percentagePerInvestor;

        for( int i = 0; i < angelInvestments.size(); ++i ) {

            // convertible notes convert here:

            percentagePerInvestor.push_back( angelInvestments[ i ] / preMoneyValuation );

       }

       percentagePerInvestor.push_back( newInvestment / preMoneyValuation );

       for( int i = 0; i < percentagePerInvestor.size(); ++i ) {

           cout << "Shares for investor # " << i << " " << percentagePerInvestor[ i ] * outstandingShares;
       
       }
       
       cout << "the company is now worth :"  << preMoneyValuation + newInvestment;

    } else {

       angelInvestments.push_back( newInvestment );

    }

    amountInvested += newInvestment;

This is how I understand the whole process. It took my lawyers a long time to explain it all to me and I'm probably still screwing something up. Go easy on C++ :)

[updated a few bug fixes]