Handling SAFE notes during a bridge round

Hey everyone, quick question on deal structure. What usually happens with SAFE notes issued in a Seed Round when a company needs a bridge round between that Seed Round and a Series A equity round?
  • Clay Norris: Those should convert if the bridge is an equity round since that is a qualified financing event. It won’t convert if the bridge is another convertible round (seems like there’s some discretion on whether or not to mark those investments up, but we haven’t at previous funds I’ve worked at unless it’s a priced round)
  • Martin Tobias: I less it is a priced round those SAFES stay outstanding. Where it gets interesting is when these bridge notes have a lower cap than prior notes (happening in this environment). That is where things get interesting and you get to see what the CEO is made of