Startup Terms Glossary
What is a Convertible Note?
Convertible notes are short-term loans that convert to equity. Noteholders generally receive interest payments in the form of equity ownership shares in place of scheduled payments. Startups rely upon convertible notes in their early funding stages for a seed round closing and later stages when they need to use bridge funding in between projects.
Convertible Note Examples
Examples of convertible note components include:
- Example 1. Maturity dates
- Example 2. Interest rates
- Example 3. Valuation caps
- Example 4. Conversion discounts
Here’s another web page about convertible notes.
Need help with a Convertible Note?
ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.
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For the last 25 years I've focused on representing businesses and entrepreneurs in transactional law deals, including LLC creation, operation and sale of businesses; real estate sales and leasing; and general contract negotiation and drafting. While I've helped all manner of businesses work out a variety of contract and business matters, I am an expert at helping clients with buying and selling commercial properties including multi-family and office projects and buildings, subdivisions, and retail shopping centers. I am also a recognized expert negotiating leases for retail and office tenants and landlords. Over 25 years I've honed my skills a lawyer at one of the largest law firms in the world, an elite real estate boutique in Aspen, Colorado and a highly regarded firm based in Denver, Colorado, before starting my own practice in 2016. Since 2016 I've been helping my clients with real estate and business deals. I'm a commercial real estate and business expert with a passion for helping clients forge successful ventures in an efficient and understandable manner.
"David was very informative during our initial call, and helped me understand the scope of work that my project needed depending on how many legal avenues I wanted addressed and covered. The work he provided was detailed and completed by the deadline that he provided."
August 2, 2023
Scott M.
Skilled/versatile attorney (and RE broker) with 10+ years' experience and diverse background in real estate, business law, injury litigation, estate planning. Select Experience: • Former General Counsel (and current Of Counsel) for a prominent real estate developer touching on all aspects of business in a hands-on and advisory role, including Lease and PSA contract negotiations; • Years of successful injury litigation practice as associate and solo (primarily plaintiff, some defense) with multiple six-figure settlements; • Years of expertise in business law for a variety of industries as well as estate planning for small to mid-size entities.
June 28, 2023
Shanon G.
Have experience in contract, family law, municipality work, criminal defense, litigation, some wills and estates as well. Been practicing law for over 22 years.
June 28, 2023
Heather B.
I currently focus on estate planning, uncontested divorces, mobile real estate closings, and contract review for small businesses after starting my firm after leaving my position a partner at a national law firm specializing in creditor rights and real property.
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