Convertible Notes- Early Stage | Start- up business Sarthak Ahuja

Convertible Note (CN) is a form of instrument by which startups can raise funds at a time when:
- Early stage with no traction or concrete product
- Valuation is difficult
- No time to go through lengthy paperwork which may take up to 4 months
Traditionally, startups use Compulsorily Convertible Preference Shares (CCPS) or Compulsorily Convertible Debentures (CCD) to raise funds. However, both require some kind of valuation and long drawn paperwork.
Here, Convertible Note (CN) comes in as a debt instrument issued in the form of a simple loan agreement. It converts to equity upon specified events or achieving certain milestones as agreed between the lender and the company, and does not require a valuation. The entire process can be completed in a matter of less than two weeks.
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A Chartered Accountant with about 10 years of experience in areas of Tax Advisory, Startup Consulting, Fundraising, Audits, Deal Advisory, Business Modelling and contract CFO services.
Winner of the ISB Young Leader Award 2017 and the Best All Rounder, PGP Class of '17, Sarthak has also been published about in the leading financial newspapers such as The Financial Express as possibly the youngest Indian to have completed the courses of CA, CS and CMA along with a graduate degree in Financial & Investment Analysis from University of Delhi, all by the age of 23 years.

[@melroydmello]

Thanks Sarthak
Really well-explained.

[@anishmoolchandani]

Thankyou so much for this, I was actually looking for it🙌

[@VirtYOUall]

This channel is really underrated….
Thanks a lot for the information…..❤

[@fullofsoundandfury4]

Agreed!

[@ayush_0606]

Just awesome!!

[@prathyusha5393]

Thank you !

[@konarkfs]

Thanks for putting this out man, would you have a standard draft/template besides the iSAFEs that you have seen being used?

[@mahimaverma9500]

Hey I have a doubt

[@akshatjain7728]

What is it?