{"id":2815,"date":"2024-08-20T11:04:45","date_gmt":"2024-08-20T11:04:45","guid":{"rendered":"https:\/\/www.isp.law\/safe-simple-agreement-for-future-equity-start-up-financing-in-liechtenstein\/"},"modified":"2025-08-12T11:01:51","modified_gmt":"2025-08-12T11:01:51","slug":"safe-simple-agreement-for-future-equity-start-up-financing-in-liechtenstein","status":"publish","type":"post","link":"https:\/\/www.isp.law\/en\/safe-simple-agreement-for-future-equity-start-up-financing-in-liechtenstein\/","title":{"rendered":"SAFE (Simple Agreement for Future Equity) \u2013 Start-up financing in Liechtenstein"},"content":{"rendered":"\n<p>In recent years, particularly in the start-up sector, new forms of financing have been increasingly established. One of the most prominent among these is the Simple Agreement for Future Equity (&#8220;SAFE&#8221;), which originates from the USA. <\/p>\n\n<p>This blog post provides an initial overview of this relatively new form of financing and highlights its advantages.<\/p>\n\n<div style=\"height:30px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n<p>1. What is a SAFE?<\/p>\n\n<p>The fundamental idea behind a SAFE is to create a simple and quick means of financing start-ups. The investor provides an investment amount upon the conclusion of the SAFE and receives a legal claim that this investment amount will later convert into an equity stake in the company. This &#8220;conversion&#8221; occurs upon the occurrence of a predefined event (&#8220;Trigger Event&#8221;), such as the first equity financing round.<\/p>\n\n<p>However, this simple US concept requires adjustments to comply with Liechtenstein law, in particular in relation to corporate law. <\/p>\n\n<p>In Liechtenstein, generally the shareholders are responsible for carrying out a capital increase. Therefore, from the investors&#8217; perspective, it must be ensured that the &#8220;conversion&#8221; is actually executed. This can be assured by way of a shareholders&#8217; agreement or by having the company&#8217;s highest governing body create authorized capital, enabling the management to carry out the capital increase independently. <\/p>\n\n<p>A SAFE under Liechtenstein law may be structured to grant the investor a contractual right to participate in a future capital increase to acquire an equity stake in the company. Alternatively, a SAFE can be structured as a type of convertible loan, which typically does not provide the investor with a repayment claim on the invested amount. <\/p>\n\n<div style=\"height:30px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n<p>2. What are the advantages of a SAFE? <\/p>\n\n<p>Compared to traditional financing instruments, a SAFE offers start-ups the following main advantages: <\/p>\n\n<ul class=\"wp-block-list\">\n<li>No interest rate: Unlike other financing instruments, such as a convertible loan, the start-up does not have to pay interest to investors. <\/li>\n<\/ul>\n\n<ul class=\"wp-block-list\">\n<li>No repayment obligation: The start-up has no repayment obligations concerning the invested capital. <\/li>\n<\/ul>\n\n<ul class=\"wp-block-list\">\n<li>Standardization: Through the standardization of a SAFE, it can be used in the same form for multiple investors, saving time and costs in negotiating these contracts with investors. <\/li>\n<\/ul>\n\n<ul class=\"wp-block-list\">\n<li>Deferral of valuation: At the signing date of the SAFE, only the valuation method needs to be determined, not the specific valuation of the start-up. Since the actual valuation occurs upon the occurrence of the &#8220;Trigger Event,&#8221; this saves time at the conclusion of the SAFE, allowing the start-up to receive the investment amount more quickly. <\/li>\n<\/ul>\n\n<ul class=\"wp-block-list\">\n<li>Better terms for early stage investors: Investors can secure better terms at the signing of the SAFE through a favorable valuation method compared to later investors. <\/li>\n<\/ul>\n\n<ul class=\"wp-block-list\">\n<li>Time for negotiating the shareholders&#8217; agreement: By concluding the SAFE and the postponed admission of the investor as a shareholder, the start-up and the investors gain time to negotiate and finalize a legally secure shareholders&#8217; agreement. <\/li>\n<\/ul>\n\n<div style=\"height:30px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n<p>3. Conclusion<\/p>\n\n<p>A SAFE (Simple Agreement for Future Equity) offers start-ups a simple and quick financing option. Through standardization and deferral of the company valuation, a SAFE saves time and costs, making it a viable alternative to other common financing methods for companies. <\/p>\n\n<p>We are pleased to advise you, as a start-up or investor, on selecting the optimal SAFE structure, its creation, negotiation, and implementation.<\/p>\n\n<div style=\"height:30px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n<p>Get started with us right now and contact us at <a href=\"mailto:office@isp.law\">office@isp.law<\/a> or use our fully automated booking tool to make an appointment directly for an initial consultation at <a href=\"https:\/\/www.isp.law\/en\/book-an-appointment\/\" data-type=\"page\" data-id=\"2366\">www.isp.law\/termin-buchen\/<\/a>. We support you in the successful financing of your company.<br\/> <\/p>\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In recent years, particularly in the start-up sector, new forms of financing have been increasingly established. One of the most prominent among these is the Simple Agreement for Future Equity (&#8220;SAFE&#8221;), which originates from the USA. This blog post provides an initial overview of this relatively new form of financing and highlights its advantages. 1. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":2813,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"","_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","footnotes":""},"categories":[43,46],"tags":[],"class_list":["post-2815","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-corporate-law","category-startup-desk-en"],"_links":{"self":[{"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/posts\/2815","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/comments?post=2815"}],"version-history":[{"count":3,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/posts\/2815\/revisions"}],"predecessor-version":[{"id":2819,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/posts\/2815\/revisions\/2819"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/media\/2813"}],"wp:attachment":[{"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/media?parent=2815"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/categories?post=2815"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.isp.law\/en\/wp-json\/wp\/v2\/tags?post=2815"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}