Elena Nikulina

Stacking SAFE agreements can cost founders half their companies, Nicole DeTommaso warns

Stacking SAFE agreements can cost founders half their companies, Nicole DeTommaso warns
Founders may lose half startups with SAFE

Nicole DeTommaso warned that founders may inadvertently give away half of their startups before realizing it due to the widespread practice of stacking SAFE agreements. She highlighted that, according to Carta, 93% of pre-seed funding rounds now use SAFEs, which make raising money fast and easy, but can have significant implications for founders.

DeTommaso has previously commented on the strategies investors use to showcase the strength of their holdings, noting that investors and VCs often excel at promoting their portfolios. She has also described how some venture capital firms accept high valuations in early-stage deals to avoid missing out on potential generational companies, despite increased risk of overpaying, as detailed in prior reporting. Her recent warning follows a series of observations highlighting challenges faced by both entrepreneurs and investors in current fundraising environments.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.