What type of raise do I need: SAFE, convertible note or priced round? The jargon doesn't help.I ran investor relations for a $20m Series A. Before that, most of these words meant nothing to me. Here's the plain version. General information, not advice.<h2>The three options</h2>A SAFE is a short contract. The investor pays now and gets shares later, usually at your next priced round. <a href="https://www.ycombinator.com/safe" rel="noopener noreferrer" target="_blank">Y Combinator</a>, which created it, says a SAFE isn't debt. No interest, no maturity date, so it's "simpler, faster, and cheaper to sign" than a note.A convertible note is debt that converts. Interest builds up, and at the maturity date it's repaid or converted.A priced round sells shares now, at an agreed price. It's the most paperwork.<h2>The trade-offs</h2><ol><li data-list="bullet">Cost and speed: SAFEs are usually quickest and cheapest. Notes add debt terms. Priced rounds take the most legal work.</li><li data-list="bullet">Valuation: a priced round sets one. SAFEs and notes put it off with a valuation cap, a discount, or both. YC says discounts are commonly 10 to 20%.</li><li data-list="bullet">Dilution surprises: on a post-money SAFE, the investor's share is locked in. Stack a few before your priced round and the extra dilution lands on you.</li></ol><h2>The Australian bits</h2>YC's forms cover companies formed in the US, Canada, the Cayman Islands and Singapore. Anywhere else, it says, you'll need a local lawyer.Locally, the Australian Investment Council updated its open-source seed documents in November 2023, including a post-money SAFE. Law firm <a href="https://addisons.com/article/updated-aic-open-source-seed-financing-documents-whats-changed/" rel="noopener noreferrer" target="_blank">Addisons</a> notes the new version is "more dilutionary for existing shareholders" than the old one.Then there's ESIC. The <a href="https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/incentives-and-concessions/tax-incentives-for-innovation/tax-incentives-for-early-stage-investors/qualifying-for-the-tax-incentives" rel="noopener noreferrer" target="_blank">ATO</a> says eligible investors in an early stage innovation company can get a 20% tax offset, capped at $200,000 a year, on newly issued shares. Law firm <a href="https://cowellclarke.com.au/assets/downloads/revisiting-the-esic-measures_october-2024.pdf" rel="noopener noreferrer" target="_blank">Cowell Clarke</a> says claiming it on a convertible note isn't viable, because a note isn't an equity interest. A SAFE might qualify, depending on how it's drafted. If your investors care about ESIC, check before you choose.<h2>A rule of thumb</h2>This one's mine. Small amount, from a few people who know you: a SAFE. An investor who insists on debt protection: a note, with one eye on the maturity date. A lead investor setting the price, usually in a bigger round: a priced round.Whichever you pick, record every instrument, its cap and its discount as you go. Ethiks360 keeps that alongside the rest of your company record, so your cap table holds no surprises.This is general information, not legal, tax or financial advice. Before you sign any SAFE, note or term sheet, take it to a lawyer and an accountant.82/18: machines did the boring bit. The thinking's mine.

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SAFE, convertible note or priced round? A plain guide for Australian founders on cost, speed, caps, discounts, dilution and ESIC.

SAFE, Convertible Note or Priced Round?

What type of raise do I need: SAFE, convertible note or priced round?

How do I prove my startup's traction to investors? Not with a screenshot.Every deck has a chart going up and to the right. When I'm the one asking the questions, I discount it until I've seen where it came from. Most investors I know do the same.<h2>Why charts get discounted</h2>It's not personal. Charts are easy to shape. A 2015 a16z post, <a href="https://a16z.com/16-startup-metrics/" rel="noopener noreferrer" target="_blank">16 Startup Metrics</a>, lists the common tricks: no label on the Y-axis, a shrunk scale to exaggerate growth, and percentage gains without the absolute numbers.It warns about cumulative charts too, which "can go up-and-to-the-right even when a business is shrinking." And it's blunt about pipeline: "Letters of intent and verbal agreements are neither revenue nor bookings."A screenshot has the same problem. It shows one moment, cropped by the person who benefits from it. Nobody can see what's outside the frame.None of that needs bad intent. Picking the chart that looks best is only human. Investors know it, so they discount the lot.<h2>Show it from the source</h2>Your traction already lives somewhere. Payments in Stripe. Revenue and cash in Xero. Pipeline and customers in HubSpot. Those systems weren't built for your pitch, which is exactly why investors trust them more than your deck.So show the data from there. Here's what holds up:<ol><li data-list="bullet">Monthly revenue, not cumulative, straight from your payments or accounting system.</li><li data-list="bullet">Recurring and one-off revenue split out, with your definitions written down.</li><li data-list="bullet">Churn and retention by cohort, worked out the same way every month.</li><li data-list="bullet">Pipeline from your CRM, kept separate from signed revenue.</li><li data-list="bullet">Cash in the bank that matches the deck.</li><li data-list="bullet">A dated snapshot each month, so the history can't quietly change.</li></ol>That last one matters most. A number you can show was recorded in March, and hasn't moved since, is worth more than a perfect chart made last night.<h2>Keep the record as you go</h2>Traction isn't one number. It's a run of numbers, kept the same way, over time.In Ethiks360, each month's numbers sit next to the decisions and customer evidence behind them, with a date on everything. When an investor asks, you show the trail, not a picture of it.Before this month ends, export your revenue straight from your payments system and file it with today's date.82/18: machines did the boring bit. The thinking's mine.

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Screenshots and deck charts get discounted. Traction shown from Stripe, Xero or HubSpot and kept as a dated record holds up.

How Do I Prove My Startup's Traction to Investors?

How do I prove my startup's traction to investors?

Show your numbers from the systems they live in, like your payments, accounting and CRM tools, and keep a dated monthly record so the history can be checked.

Charts are easy to shape. a16z lists common tricks like unlabelled axes, shrunk scales, percentages without absolute numbers, and cumulative charts that rise even when a business is shrinking.

Why do investors discount traction charts?

Not as revenue. a16z says letters of intent and verbal agreements are neither revenue nor bookings. Show them as pipeline, kept separate from signed revenue.

Do letters of intent count as traction?

How do investors verify a startup's claims? Less glamorously than you'd think. Mostly we ask for the source and see if it matches the slide.At 45 I didn't know what a Series A was, let alone investor relations. Then I read Venture Capital for Dummies twice and ran investor relations for a $20m one. Now I've got an investor profile on Capital HQ, and I'm still asking the questions.<h2>What investors actually check</h2>The pitch makes claims. Diligence tests them. At the early stage that usually means:<ol><li data-list="bullet">References: people who've worked with you, including some you didn't put forward.</li><li data-list="bullet">Customer calls: a few of your customers, asked what they pay and why they stay.</li><li data-list="bullet">Bank statements: the cash in the deck should be the cash in the account.</li><li data-list="bullet">The cap table: who owns what, matched against the share issues and agreements.</li><li data-list="bullet">Metrics: revenue, churn and growth, checked against the systems they come from, not the spreadsheet built for the raise.</li></ol>Later rounds go deeper. <a href="https://www.ycombinator.com/library/3h-series-a-diligence-checklist" rel="noopener noreferrer" target="_blank">Y Combinator's Series A diligence checklist</a> runs from board minutes to share issues to every contract over $25,000. It notes that closing an A can take more than a month, "much of which is often spent tracking down documents for lawyers."<h2>Why the checking matters</h2>Most founders aren't lying. But numbers drift. A definition changes, a spreadsheet gets tidied, a churned customer stays in the count.Sometimes it's worse. Frank's founder told JPMorgan the startup had 4.25 million users. According to the <a href="https://www.fdicoig.gov/news/investigations-press-releases/startup-ceo-charlie-javice-sentenced-85-months-prison-175" rel="noopener noreferrer" target="_blank">sentencing release</a>, it had about 300,000. When the bank tried to verify, a fabricated data set went to a third-party vendor, which confirmed it had over 4.25 million rows. JPMorgan paid $175 million. The founder got 85 months in prison.The check counted rows in a copy. It never touched the source. For investors, that's the lesson: go to where the numbers live. For founders, it's the flip side: a copy is exactly what makes honest numbers look shaky.<h2>Why a live record holds up</h2>The easiest claim to verify is one that was never rebuilt. If your numbers come from where they live, and your decisions and customer evidence were written down as they happened, checking is quick. The references match the record. The bank matches the deck.Ethiks360 is built so that record already exists when the checking starts. You hand over what happened, not a version made for the raise.Pick the one number in your deck you'd least like checked, and trace it back to its source this week.82/18: machines did the boring bit. The thinking's mine.

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What investors actually check in diligence, from references to bank statements, and why claims backed by a live record hold up.

How Do Investors Verify a Startup's Claims?

How do investors verify a startup's claims?

They check claims against sources: references, customer calls, bank statements, the cap table, and metrics in the systems they come from. Later rounds add a full document review.

Y Combinator's checklist covers corporate records and minutes, financials, intellectual property, share issues, material contracts, disputes and employee matters.

What's on a Series A diligence checklist?

Y Combinator's checklist notes closing an A can take more than a month, much of it spent tracking down documents. Having them in one place before the term sheet can cut as much as a week.

How long does it take to close a Series A?

What documents and records does a startup need from day one? Most guides hand you a checklist and stop there.Register the company with ASIC. Get an ABN. Sort a constitution and a shareholders agreement. Assign the founders' IP to the company. Sign proper customer contracts.All needed. But all they prove is that you exist.<h2>What the law already asks for</h2>Australian companies have record-keeping duties from the start. Under <a href="https://www.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/ca2001172/s286.html" rel="noopener noreferrer" target="_blank">section 286 of the Corporations Act</a>, a company must keep financial records that correctly record and explain its transactions, and keep them for 7 years. The <a href="https://www.ato.gov.au/businesses-and-organisations/preparing-lodging-and-paying/record-keeping-for-business/overview-of-record-keeping-rules-for-business" rel="noopener noreferrer" target="_blank">ATO</a> says you need to keep most tax records for 5 years.Then there's <a href="https://www.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/ca2001172/s251a.html" rel="noopener noreferrer" target="_blank">section 251A</a>. A company must record the proceedings and resolutions of directors' and members' meetings in its minute books within one month.Read that one again. The law already expects you to write decisions down as they happen, not later.<h2>Existing isn't the same as credible</h2>When I was the one asking the questions, the incorporation papers took a minute to check. The real conversation was about what happened next. Why this market? Who's paying, and how do you know they're happy? Do the numbers in the deck match the books? That's where trust gets won or lost.The founders with a record could just show me. The rest had to rebuild it from inboxes and memory. And rebuilt history always looks a bit rebuilt.<h2>What to keep from day one</h2>On top of the paperwork, here's what I'd keep, as it happens:<ol><li data-list="bullet">Decisions: what you decided, who decided and why. Pricing, hires, pivots, the lot.</li><li data-list="bullet">Customer evidence: calls, feedback, orders, complaints and churn, dated and in their words.</li><li data-list="bullet">Numbers: revenue, burn, runway and the few metrics you run on, updated monthly with the assumptions behind them.</li><li data-list="bullet">Ownership changes: every share issue or transfer, logged when it happens and matching the paperwork.</li></ol>None of it is hard on the day. It's very hard to recreate two years later.<h2>Start the record now</h2>Ethiks360 is a place to keep those records from week one, so when an investor, a buyer or your accountant asks, you show what happened instead of reconstructing it.The documents prove you exist. The records show you're worth backing.Today, write down the last three decisions you made, why you made them and the date.82/18: machines did the boring bit. The thinking's mine.

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Most startup checklists stop at proving you exist. What Australian founders should record from day one: decisions, customers and numbers.

Startup Documents and Records From Day One

What documents and records does a startup need from day one?

The documents that prove you exist, like ASIC registration, an ABN, a constitution or shareholders agreement, founder IP assignment and customer contracts. Then records of what happens: decisions, customer evidence and numbers, kept as they happen.

Section 286 of the Corporations Act says financial records must be kept for 7 years after the transactions are completed. The ATO says most tax records must be kept for 5 years.

How long do Australian companies need to keep financial records?

Yes. Section 251A of the Corporations Act requires a company to record the proceedings and resolutions of directors' and members' meetings, and resolutions passed without a meeting, in its minute books within one month.

Do Australian startups need to keep minutes?

Dated records of key decisions, customer evidence and current numbers, kept as they happen and matching your accounts and cap table.

What records help most in investor due diligence?

How do I get customers to trust a brand-new company? Every founder asks it. Most answers sound the same.Borrow some trust. Put up a logo wall. Collect a few testimonials. Stick a badge or two in the footer.I get why. When you're new, you've got nothing to point at. But borrowed badges are a thin coat of paint, and careful buyers can see through it.<h2>Badges are easy to fake</h2>Anything that's easy to put on a website is easy to put there without earning it.Regulators know this. The <a href="https://www.accc.gov.au/business/advertising-and-promotions/online-reviews-for-product-and-services" rel="noopener noreferrer" target="_blank">ACCC</a> says it's against the law for a business to create fake or misleading reviews, or to arrange for others to do it. It points to a removalist, Citymove, that copied testimonials from an unrelated review site, changed them and published them as genuine. It paid a $6,600 penalty.In the US, the <a href="https://www.ftc.gov/news-events/news/press-releases/2024/08/federal-trade-commission-announces-final-rule-banning-fake-reviews-testimonials" rel="noopener noreferrer" target="_blank">FTC's 2024 rule</a> bans fake reviews and testimonials, including AI-generated ones, and lets the regulator seek civil penalties.So the honest founder's badge sits next to the faked one, and a buyer can't easily tell them apart. Which means it isn't doing much work.<h2>Show what you did instead</h2>When I was the one asking the questions, a logo wall told me very little. What I wanted was the trail. What did you promise? What did you deliver? What went wrong, and what did you do about it?A new company can't have a long history. It can have an honest one, kept from day one. That's trust a stranger can actually check.Here's what I'd start keeping now:<ol><li data-list="bullet">Every customer commitment, with the date you made it.</li><li data-list="bullet">What you shipped, and when.</li><li data-list="bullet">Feedback as it arrives, good and bad, in the customer's words.</li><li data-list="bullet">Problems, and how you fixed them.</li><li data-list="bullet">Key decisions, and why you made them.</li><li data-list="bullet">Your numbers, kept current, not tidied up later.</li></ol>None of it needs to be pretty. It needs to be real, dated and kept as it happens, not rebuilt the week before a big deal.<h2>Let them check</h2>A testimonial asks a buyer to take your word for it. A record lets them see for themselves. Investors want the same thing when diligence starts.Ethiks360 gives you one place to keep that trail from your first customer on, so the proof is already there when a buyer or investor asks.Small and new is fine. Small, new and checkable beats big and decorated.Earn the badge before you hang it: this week, write down your first customer commitment with today's date.82/18: machines did the boring bit. The thinking's mine.

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Logos and testimonials are borrowed trust. A dated record of what you actually did is trust buyers and investors can check.

How a Brand-New Company Earns Customer Trust

How do I get customers to trust a brand-new company?

Don't lean on borrowed badges like logo walls and testimonials. Keep a dated record of what you promised, delivered and fixed from day one, and let buyers and investors check it.

Yes. The ACCC says it's against the law for a business to create fake or misleading reviews or arrange for others to do so, and it has penalised a business for publishing copied testimonials as genuine.

Are fake testimonials illegal in Australia?

Customer commitments with dates, what you shipped and when, feedback good and bad, problems and how you fixed them, key decisions and why, and current numbers.

What should a new company record from day one to build trust?

The real cost of a raise isn't your hours. It's your head.Paul Graham said it years ago in <a href="https://paulgraham.com/fr.html" rel="noopener noreferrer" target="_blank">How to Raise Money</a>: "When you start fundraising, everything else grinds to a halt."I know that feeling. When I was the one asking the questions, it ate most of my week. Not just the meetings. The prep, the follow-ups, the replaying of every conversation on the drive home.<h2>It takes more than time</h2>The numbers back it up. A 2025 <a href="https://www.angelinvestmentnetwork.net/2025-survey-shatters-the-myth-of-the-young-founder-working-from-their-parents-garage/" rel="noopener noreferrer" target="_blank">Angel Investment Network survey</a> of 610 US founders found more than one in four spend over half their week on fundraising. And 45% said it hurts their ability to run the startup.<a href="https://www.docsend.com/blog/seed-pitch-deck-best-practices/" rel="noopener noreferrer" target="_blank">DocSend's research</a> on seed rounds puts the average raise at 11 to 15 weeks, with founders contacting 58 investors and taking 40 meetings. That's a lot of coffees.But Graham's sharper point is this: "The problem is not the time fundraising consumes but that it becomes the top idea in your mind."That's the bit that hurts. When the raise owns your head, nobody's minding the company. And as he puts it, "if the founders look away, growth usually drops sharply."Which is a rotten spot to be in, because growth is exactly what investors want to see while you're talking to them.<h2>Get your agency back</h2>You can't make fundraising painless. You can stop it starting from zero.Most of the drain comes from building everything mid-raise. Digging out numbers. Rewriting the story for the fifth time. Chasing a document you know exists somewhere. Each one pulls you further from the business.So do the heavy lifting before the raise starts. Here's what I'd have sorted:<ol><li data-list="bullet">Your story in a few plain sentences, the same every time you tell it.</li><li data-list="bullet">Your numbers, current, with the assumptions behind them.</li><li data-list="bullet">Your cap table, matching the paperwork.</li><li data-list="bullet">What the money is for and what it gets you to.</li><li data-list="bullet">Honest answers to the questions you know are coming.</li><li data-list="bullet">One person who runs the raise, so the rest of the team keeps building. Graham suggests this too.</li></ol>None of that is glamorous. All of it is easier when you're not doing it under pressure.<h2>Keep the company in front</h2>The aim isn't a faster raise. It's a raise that doesn't swallow everything else while it's on.Ethiks360 keeps your company record current between raises, so the next one starts from a full folder, not a blank one and a deadline.Then the meetings can be about the business, and between them you can actually run it.Graham's advice is to get fundraising over with and get back to building. I'd add one thing: get ready before you start, so there's still a company to get back to.Pick the one person who'll run your next raise, and tell the rest of the team today.82/18: machines did the boring bit. The thinking's mine.

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Fundraising takes your head, not just your hours. Why a raise swallows the company, and how to get ready before it starts.

Fundraising Shouldn't Eat Your Company

DocSend's research puts the average seed raise at 11 to 15 weeks, with founders contacting 58 investors and taking 40 meetings.

How long does it take to raise a seed round?

In a 2025 Angel Investment Network survey of 610 US founders, more than one in four spent over half their week on fundraising, and 45% said it hurt their ability to run the startup.

How much time do founders spend fundraising?

Get your story, numbers and documents ready before the raise starts, and have one person run the raise so the rest of the team keeps building.

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