Slicing The Pie: Offering Security In A Startup

Overall, 2021 has been a big year for Saskatchewan tech. In August, the Canadian Venture Capital & Private Equity Association (CVCA) reported Saskatchewan venture capital investment reaching a record-breaking level of $171 million for the first half of 2021.¹  In November, the CVCA reported an additional $28 million of private equity investment over 13 deals in the province.²

As founders make plans to raise and access that capital, set out below is a quick primer on types of security they can offer.

• Common Equity - This means standard common, voting shares in the capital of a startup. They will typically be of the same class of shares as the ones held by the founders.
• Simple Agreement for Future Equity (SAFE) - This is a right to acquire shares of the startup in future once a raise round of a certain amount has occurred. At that time, the principal amount of the SAFE (i.e. the amount the investor invested) will convert into shares of the startup at a certain