SAFE (Simple Agreement for Future Equity)
An agreement between an investor and a company that provides rights to the investor for future equity, except without determining a specific price per share at the time of the initial investment. The SAFE investor receives the futures shares when a priced round of investment or liquidation event occurs. SAFEs are intended to provide a […]
SAFE-T (Simple Agreement for Future Equity or Tokens)
A SAFE-T is an agreement between an investor and a company that provides rights to the investor for when a cryptocurrency or other product is created, the investor will be given access to the newly created cryptocurrency or equity, except without determining a specific price at the time of the initial investment. SAFE-Ts are intended […]
SAFT (Simple Agreement for Future Tokens)
A SAFT is an agreement between an investor and a company that provides rights to the investor for when a cryptocurrency or other product is created, the investor will be given access, except without determining a specific price at the time of the initial investment. SAFTs are intended to provide a simple mechanism for startups […]
Secondary Sale
A secondary sale is the sale by an existing stockholder of shares in a private company to a third party that does not occur in connection with an acquisition of the company. Secondary sales differ from primary sales because in primary sales, the company sells stock to its investors and keeps the money. In secondary […]
Security Filings
Referring to the Federal Form D and Blue Sky filings.
SEDAR
System for Electronic Document Analysis and Retrieval, the electronic filing system for the disclosure documents of issuers across Canada, excluding Ontario and British Columbia as they can be filed outside SEDAR. This is the Canadian equivalent of the Securities and Exchange Commission (SEC).
Series A (Series Seed, Series B, Series C – Class of Stock)
Series A, B, and C are funding rounds that generally follow “seed funding” and “angel investing,” providing outside investors the opportunity to invest cash in a growing company in exchange for equity or partial ownership. Series A, B, and C funding rounds are each separate fund-raising occurrences. Series A is the first major round of […]
Series LLC (SLLC)
A Series Limited Liability Company is a master LLC whose organizing document provides for separate subunits (series), which operate as independent LLCs. It is a form of a limited liability company that provides liability protection across multiple “series” each of which is theoretically protected from liabilities arising from the other series, protect personal assets from […]
Shareholder (Stockholder
Any person, company or other institution that owns at least one share of a company’s stock. Shareholders are a company’s owners. They have the potential to profit if the company does well, but that comes with the potential to lose if the company does poorly. SPVs are the shareholders of companies they invest in and […]
Shutdown (Closedown, Dissolution)
Portfolio company Shutdown. A cessation of operations or activity of a company or a segment of its operations. Usually, it happens when a company experiences no benefit for continuing operations, runs out of cash, or shuts down temporarily; it is the combination of output and price where the company earns just enough revenue to cover […]
Side Letter
An Organizer will use a side letter to provide one SPV investor different (usually improved) economic terms than another investor or the rest of the SPV investors. Sometimes an SPV Organizer will reward or entice an investor to subscribe to the SPV with a change in the SPV economics, like lower carry or management fees. […]
SPA (Stock Purchase Agreement, Deed of Conditional Sale, Deed of Subscription, Asset Purchase Agreement, Purchase Agreement)
A sales and purchase agreement (SPA) is a legal contract that obligates a buyer to buy and a seller to sell a product or service. An SPA serves as a basis for a transaction to take place, providing a framework of how the transaction will proceed, what is included in the transaction, and, if necessary, […]
SPV (Special Purpose Vehicle)
A legal structure, used typically to aggregate funds of one or more investors to purchase a private asset. SPVs have been used as a financial structure method in a number of contexts including derivatives trading, securitization transactions, and pooled investments. Today, Organizers from around the world are using the SPV structure to facilitate pooled investments […]
SS4
IRS form or application to apply for an EIN. This relays the contact information for the entity and the person responsible for requesting it. See EIN.
SSN (Social Security Number)
A nine-digit number assigned to citizens, some temporary residents and permanent residents of the United States (US) in order to track their income and determine benefit entitlements. US investors into an SPV need to share their SSN with the SPV Organizer for KYC/AML background check purposes. Read more: http://www.investopedia.com/terms/s/ssn.asp#ixzz4EK9E8Hmj