WHAT’S ACTUALLY HAPPENING

There are three primary instruments:

• SAFEs
• Convertible notes
• Priced equity

An SPV is not a fourth instrument.
It is a vehicle that uses one of the above.

WHY THIS HAPPENS

Founders confuse:

• instruments (SAFE, note, equity)
  with:
• vehicles (SPVs)

This leads to:

• poor structure
• messy cap tables
• investor confusion

WHERE FOUNDERS GET STUCK

• Using too many SAFEs without tracking dilution
• Choosing notes without understanding maturity risk
• Jumping into priced rounds too early
• Misunderstanding how SPVs work

WHAT TO FIX

• Use SAFEs for speed and simplicity
• Use notes when investors need protection
• Use priced rounds when valuation is clear
• Use SPVs to aggregate investors, not replace structure

TAKEAWAY

The instrument you choose shapes:

• dilution
• investor expectations
• long-term control

Keep it simple, aligned, and intentional.