conversion-calculator

Conversion Calculator

Calculate how SAFEs and convertible notes convert into equity at a given round price or valuation.

When to Use

• "How many shares would the SAFEs convert into at a $50M pre?"
• "Calculate SAFE conversions for the Series A"
• "What happens to the convertible notes if we raise at $10/share?"
• "Show me the conversion math for all outstanding instruments"

Prerequisites

You need:

1. corporation_id — get from list_accounts
2. Round terms — user must provide at least a pre-money valuation or price per share

If neither is provided, you MUST call AskUserQuestion BEFORE any computation: AskUserQuestion("What pre-money valuation or price per share should I use for the conversion calculation?")

Subagent prohibition: Do NOT delegate this skill to a background agent if the round valuation or price per share is missing. A subagent cannot ask the user for input. If these are absent and you are considering dispatching an agent, stop — ask the user directly first, then proceed.

Data Retrieval

• fetch("cap_table:get:convertible_notes", {"corporation_id": corporation_id}) — SAFEs + convertible notes
• fetch("cap_table:get:cap_table_by_share_class", {"corporation_id": corporation_id}) — current fully diluted count
• fetch("cap_table:get:409a_valuations", {"corporation_id": corporation_id}) — current FMV (for reference)

Key Fields

From convertible instruments:

• is_debt: false = SAFE, true = convertible note
• dollar_amount: principal investment amount
• price_cap: valuation cap
• discount_percent: discount rate (e.g. "20.00" = 20%)
• interest_rate: annual interest rate (notes only)
• total_with_interest: principal + accrued interest (use this for note conversions)
• has_most_favored_nation_clause: MFN SAFE — converts at best subsequent terms
• status_explanation: filter to "Outstanding" only

Step 1: Gather Instrument Data

1. fetch("cap_table:get:convertible_notes", {"corporation_id": corporation_id}) — SAFEs + notes (filter to status_explanation: "Outstanding")
2. fetch("cap_table:get:cap_table_by_share_class", {"corporation_id": corporation_id}) — get current fully diluted share count from totals.total_fully_diluted
3. fetch("cap_table:get:409a_valuations", {"corporation_id": corporation_id}) — current FMV for context

Step 2: Conversion Math

SAFE Conversion

For each SAFE, compute shares under both methods, use the one giving MORE shares:

Cap conversion:

cap_price = valuation_cap / pre_money_fully_diluted_shares
shares = investment_amount / cap_price

Discount conversion:

discount_price = round_price_per_share * (1 - discount_rate)
shares = investment_amount / discount_price

No cap, no discount (MFN):

• Converts at the round price (or the best terms of a subsequent SAFE)

shares = investment_amount / round_price_per_share

Convertible Note Conversion

Same as SAFE but:

• Use total_with_interest (principal + accrued interest) instead of investment amount
• If interest_rate and maturity_date are available and total_with_interest is not, calculate:

  years = (conversion_date - issue_date) / 365
  total = principal * (1 + interest_rate * years)
  

Step 3: Present Results

Per-Instrument Table

Instrument	Investor	Amount	Accrued Interest	Total	Cap	Discount	Method Used	Price/Share	Shares
SAFE-1	Investor A	$500,000	—	$500,000	$6M	20%	Cap	$0.60	833,333
SAFE-2	Investor B	$250,000	—	$250,000	$8M	—	Cap	$0.80	312,500
CN-1	Investor C	$500,000	$240,164	$740,164	$8M	20%	Discount	$0.88	840,914

Summary

Round price per share: $1.10
Pre-money fully diluted: 10,000,000 shares

SAFE conversions: 1,145,833 shares ($750,000 invested)
  - Effective avg price: $0.65/share (41% discount to round price)

Note conversions: 840,914 shares ($500,000 principal + $240,164 interest)
  - Effective avg price: $0.88/share (20% discount to round price)

Total conversion shares: 1,986,747
Post-conversion fully diluted: 11,986,747

Important Notes

• Always show which conversion method (cap vs discount) was more favorable and used
• If a SAFE has both cap and discount, compute both and pick the one yielding more shares
• For MFN SAFEs, note that they take the best terms of any subsequent SAFE
• Accrued interest on notes can significantly increase the conversion amount — always account for it
• State the assumed conversion date (today or the round close date)
• This is an estimate — actual conversion depends on legal documents. Recommend review by counsel.