Startup Investing

Convertible Note

Definition

What is Convertible Note?

A debt instrument intended to convert into equity under specified conditions.

Example in practice

The note converts into preferred shares at the next funding round.

Keep learning

A preliminary document outlining the main commercial terms of a proposed investment.

A company's agreed value immediately before a new investment.

A company's value immediately after adding new investment capital.

The rate at which a company spends cash, commonly measured monthly.

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