# SAFE

> SAFE — Cash from an investor in exchange for a right to shares in a future priced round, usually at a valuation cap or a discount. Not debt and not yet stock; because a SAFE can require cash on a change of control, it is often classified as a liability under ASC 480 and remeasured at fair value — the terms decide.

Source: https://lopifi.com/glossary/safe
Part of: Lopifi — US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

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**What is safe?** In accounting, SAFE means cash from an investor in exchange for a right to shares in a future priced round, usually at a valuation cap or a discount. Not debt and not yet stock; because a SAFE can require cash on a change of control, it is often classified as a liability under ASC 480 and remeasured at fair value — the terms decide.

## Also known as

- Simple agreement for future equity

## Words this system refuses for it

- convertible note (that is debt)
- equity

- **Category:** Equity & financing
- **Specified in:** [Lexicon](https://lopifi.com/md/docs/domain/11-lexicon)
- **Rendered by:** [bulk-action-bar](https://lopifi.com/md/components/bulk-action-bar), [journal-entry](https://lopifi.com/md/components/journal-entry), [payment-form](https://lopifi.com/md/components/payment-form), [sheet](https://lopifi.com/md/components/sheet), [statement-row](https://lopifi.com/md/components/statement-row)
- **Related:** liability