A convertible note is a loan that converts to equity at the same terms of the Series A investor. Similarly, a SAFE (simple agreement for future equity) also relies on the terms of the Series A investor. Do an internet search for more on how these agreements work. In the Slicing Pie model, both SAFEs and convertible notes can be offered for investments from “arm’s-length” angel investors instead of slices. An arm’s-length angel is someone who is simply backing the company financially, and not taking an active role in advising or managing the company.
