Pre-Money SAFE
An older SAFE format where the valuation cap does not include the SAFE investment itself.
Definition
A pre-money SAFE is the original SAFE format where the valuation cap does not include the SAFE investment. This means all SAFE investors share dilution with each other: the more SAFEs raised, the more diluted each SAFE investor becomes. Pre-money SAFEs are less common today because investors prefer the clarity of post-money SAFEs, but you may still encounter them.
Why it matters
If your company used pre-money SAFEs, the dilution math is more complex and founders retain slightly more ownership compared to post-money SAFEs with the same cap. However, it is harder for anyone to calculate exact ownership until conversion.
Example
Investor A puts $500K into a pre-money SAFE at a $5M cap. Investor B puts another $500K at the same cap. Both investors share the ownership stake, together getting about 17% instead of 20% because the cap is pre-money.