Discount Rate

Convertible debt is a loan that transforms into equity during future funding. It allows founders to secure capital quickly while delaying complex valuation discussions until later.

A convertible note is a loan that transforms into equity. This article explains the mechanics of the conversion, the importance of valuation caps, and how it differs from a SAFE.

Understand the mechanics of the discount rate in early fundraising, how it rewards investor risk, and how it interacts with valuation caps.

Explains the extra return investors demand for risky assets over safe bonds and how this calculation directly impacts your startup’s valuation.

Understand how to value future investments today by accounting for time and opportunity costs using the Net Present Value formula.