Business & Money · Tip
Day 1 Startup Fundraising Strategy
Lean framework for early startup incorporation and raising initial capital using SAFEs
A practical workflow for new startup founders to incorporate cleanly and raise early money with minimal legal costs. It outlines using self-service incorporation through Clerky and raising rolling angel checks on standard Y Combinator SAFEs. This delays expensive priced equity rounds and complex investor rights agreements until a lead investor requires them.
How it works
- Incorporate the company yourself online using Clerky (clerky.com).
- Download a free standard post-money SAFE agreement template from Y Combinator (ycombinator.com/documents).
- Raise initial capital directly on SAFEs to minimize legal friction and paperwork.
- Once a lead investor is secured to set round terms, execute a priced seed round requiring full corporate documents (Shareholder Agreement, Investor Rights Agreement, and additional closing docs).
What it's for
- Incorporate a Delaware C-Corp affordably without high lawyer retainers
- Close early angel checks quickly using standard post-money SAFEs
- Avoid unnecessary legal fees during pre-seed fundraising
Key points
- Incorporate the company using an automated platform like Clerky
- Use standard, unedited Y Combinator post-money SAFE templates
- Raise rolling angel investments directly on SAFEs without board seats or governance overhead
- Postpone priced rounds and complex legal documents until finding a lead investor
Pricing
Free. Strategy is free; standard YC SAFE templates are free, Clerky charges incorporation fees.
Details
- Type
- Tip
- Category
- Business & Money
- Topic
- Fundraising
- Open source
- No
- Platforms
- Web
- For
- First-time founders and early-stage startup creators
- Alternative to
- Custom priced equity rounds from early lawyers, Convertible notes
- Tags
- fundraising, startups, safes, venture capital, incorporation, angels
Why it was saved
- @yupyork: Saves founders time and thousands of dollars in early legal fees by avoiding priced rounds until a lead investor requires them.
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Updated