With two cap-only post-money SAFEs, divide each investment by its cap, then add the percentages. That gives a useful estimate of their combined stake if the cap price controls at conversion. A later priced round dilutes that stake again. The two calculations answer different questions: what the SAFEs convert into, and what the new financing leaves each holder with.
A SAFE is a Simple Agreement for Future Equity: a contractual right to future shares, rather than stock issued when signed. Y Combinator’s SAFE materials explain the instrument. If you are comparing it with debt, start with the SAFE versus convertible note baseline.
A two-SAFE worksheet
Consider a hypothetical company with these outstanding cap-only post-money SAFEs:
| Instrument | Investment | Post-money valuation cap | Investment ÷ cap |
|---|---|---|---|
| SAFE 1 | $1,000,000 | $10,000,000 | 10% |
| SAFE 2 | $750,000 | $10,000,000 | 7.5% |
| Combined | $1,750,000 | — | 17.5% |
The 17.5% is a conditional, as-converted estimate: the projected stake after conversion at the cap prices, before new financing shares. It is not a statement that SAFE investors already hold stock.
For the worksheet, assume both cap prices control, founders and common holders own the remaining shares, and new investors receive 20% after the priced round closes. There are no options, unissued option pool, other convertibles, discounts, most-favored-nation amendments, pro rata purchases, or side letters. Those exclusions keep the example reproducible; add them back when modeling your company.
Y Combinator’s official User Guide explains why post-money here means after SAFE money, before the later equity-financing money. The guide also warns that a round below or too close to the cap can produce more shares than the headline estimate. Check the conversion price before using this worksheet.
Separate conversion from new-round dilution
Under the stated cap-price assumptions, the two SAFE estimates total 17.5%, leaving founders and common holders at 82.5% immediately before the new financing shares.
If new investors receive 20% after closing, the existing groups together retain 80%. Multiply each pre-financing estimate by 0.80:
| Holder | As-converted estimate before new financing | After 20% new-investor ownership |
|---|---|---|
| Founders and common holders | 82.5% | 66% |
| SAFE 1 | 10% | 8% |
| SAFE 2 | 7.5% | 6% |
| New investors | — | 20% |
The checks are simple: 82.5 + 10 + 7.5 = 100 before new money; 66 + 8 + 6 + 20 = 100 after it. Combined SAFE ownership falls from 17.5% to 14%. The change is 3.5 percentage points, or 20% of the original SAFE stake.
A common mistake is to treat the post-money cap as including the next priced round. It does not. Another is to subtract 20 percentage points from each holder. Financing dilution multiplies the old percentage by the retained fraction; 10% × 80% is 8%, not a negative stake.
This worksheet calculates percentages. To calculate issued shares, use the financing share price and the capitalization definitions in the signed documents.
Know when the shortcut stops working
| Situation | What to do |
|---|---|
| Both cap prices control, with the exclusions above | Calculate each investment-to-cap estimate, then apply new-round dilution. |
| The priced round is below or near a cap | Compare the cap-based and new-money-price share results under the signed SAFE. The investor may receive more shares than the cap estimate. |
| There is a financing option-pool increase | Model the pool separately. The new-investor percentage alone no longer captures all dilution. |
| SAFEs have different forms, discounts, or amended terms | Calculate each instrument separately before combining the ownership results. |
| A holder invests under a pro rata side letter | Include the holder’s new purchase as well as conversion shares. |
For the standard YC post-money cap-only SAFE, the equity-financing mechanism gives the holder the more favorable share result from the applicable cap-based or new-money-price calculation. The signed agreement determines the precise calculation. The User Guide’s equity-financing questions explain the below-cap and near-cap cases.
Potomac Law’s explanation of complicated SAFE financings covers why mixed documents and negotiated rights need closer attention. Its practical caution complements the primary YC guidance; neither replaces your signed contracts.
Build a model you can reconcile
- Inventory the documents. Record each SAFE’s amount, cap, form, discount, amendments, and side letters. Compare the list with what a cap table records.
- Confirm conversion prices. Ask which price controls for each SAFE at the proposed financing. Keep a conditional estimate separate from the actual conversion share count.
- Set the financing assumptions. Record new-money ownership and the pool increase. Use option pool sizing to understand the separate pool effect.
- Check every denominator. Identify which shares, options, pools, and convertibles the documents include. A sum of 100% is an arithmetic check, not proof that the inputs are right.
- Reconcile to the closing model. Compare conversion shares and final ownership with the financing documents before closing.
The Capable round-modeler screen above uses fictional Northwind data to show financing scenarios and ownership changes. It is product evidence, not a customer result or the numerical example in this article.
Use the SAFE dilution tool for a first-pass calculation with your own amounts and caps. For document-specific conversion, bring the signed SAFEs, current capitalization, proposed financing price, and pool terms to your finance team or counsel. Capable’s round-modeling service can help organize the model; legal interpretation belongs with your counsel.