In a priced round, the SAFE converts into shares based on the pre-money valuation, which includes the increased options pool.

In a merger or acquisition, a SAFE investor converts their investment into shares of common stock based on the target valuation, allowing them to participate in the proceeds of the merger.

The SAFE (Simple Agreement for Future Equity) allows investors to convert their investment into equity at a later date, but the exact ownership percentage isn't known until the priced round occurs.

If a company never raises a priced round, the SAFE only converts if the company is sold or goes public, which is a rare scenario.

The SAFE investor's shares are calculated based on the conversion price, which is determined by the valuation cap if it's lower than the priced round valuation.

A SAFE, or Simple Agreement for Future Equity, allows an investor to provide money now in exchange for a promise of shares at a future date when a priced round occurs.

In a priced round, the SAFEs convert into shares, and the option pool is often increased to accommodate new hires, which can dilute existing shareholders.

Founders need to be aware that their ownership percentage can decrease significantly due to dilution from SAFEs and new equity rounds, so they should plan accordingly for future fundraising. The percentage of ownership for SAFE investors is based on the valuation cap in the SAFE, and if the priced round valuation is higher than the cap, they convert at the cap, receiving more shares for the same investment than Series A investors.

When signing a SAFE, you might expect to own around 9% of the company based on an $800,000 investment at an $8 million cap, but this can be diluted by new money coming in during the priced round.