Simple Agreement For Future Equity Template for the Netherlands

A Simple Agreement For Future Equity (SAFE) is an investment contract that allows you to raise capital for your Dutch startup without immediately determining company valuation or issuing shares. Under Netherlands law, this document creates a legal framework where investors provide funding in exchange for the right to receive equity when specific conversion events occur, typically during future financing rounds.

When do you need this document?

You need a SAFE when you're seeking early-stage funding but want to avoid the complexity and time requirements of traditional equity financing. This is particularly relevant when you're running a pre-revenue startup that hasn't established a clear market valuation, when you need bridge funding between formal investment rounds, or when you're working with angel investors or accelerators who prefer simplified investment structures. SAFEs are also essential when you want to close funding quickly without extensive due diligence processes that typically accompany equity rounds.

Key legal considerations

Your SAFE must clearly define conversion triggers, which typically include qualified financing rounds, liquidation events, or dissolution scenarios. The agreement should specify valuation caps or discount rates that determine how the investment converts to equity, protecting both investor interests and founder dilution concerns. You must carefully draft provisions regarding investor rights, including information rights, participation rights in future rounds, and anti-dilution protections. The document should address what happens in various exit scenarios, including acquisition, merger, or company dissolution. Additionally, ensure that conversion mechanics are clearly defined to avoid disputes when conversion events occur, and include appropriate representations and warranties regarding your company's legal status and authority to enter the agreement.

Legal requirements in Netherlands

Under Dutch law, your SAFE must comply with the Dutch Civil Code (Burgerlijk Wetboek), particularly Book 6 provisions on general contract law and Book 2 concerning legal entities. You must ensure the agreement doesn't inadvertently create securities that require registration under the Dutch Financial Supervision Act (Wft), which could trigger regulatory compliance obligations. The document must respect Dutch Corporate Law requirements for future share issuances, including board resolutions and shareholder approval procedures that will be necessary during conversion. You should structure the agreement to maintain compliance with Dutch securities regulations while preserving the flexibility that makes SAFEs attractive. Consider whether your SAFE arrangement requires notification to Dutch financial authorities, particularly if you're accepting investments from institutional investors or if the arrangement might be classified as a regulated financial instrument under Dutch law.