By using our SeedFAST product you can issue BSA Air which is an investment agreement where the investor invests money now, and that investment will convert into shares at a later date when one of 4 trigger events is reached:
1: On a new qualifying funding round
When you issue a BSA Air thanks to our SeedFAST product you'll specify what amount of new investment constitutes a new funding round. When you raise that amount of investment (either in one go or cumulatively over any number of individual raises - you can choose which you'd like when you create the SeedFAST) that will cause the BSA Air to convert "on a new round".
In this scenario you can give the BSA Air investor a Discount (typically 10% to 20%) on the valuation that new investors in the round will pay, as an incentive for the BSA Air investors to invest earlier.
You can also choose to apply a Cap, which means that if the valuation in your new round is above that cap, the BSA Air will still convert at the Cap. This is a protection for the SeedFAST investor to avoid the company giving them very few shares by raising the next round at a very high valuation.
If you apply both a discount and a cap, then the BSA Air will convert at the lower of the new round valuation minus the discount, or the cap (i.e. the discount is not applied to the cap).
2: On the Longstop Date
If a funding round doesn't happen before a certain date, known as the Longstop Date, then the BSA Air will convert at the Floor valuation, which you can specify when you create the BSA Air.
3: On an IPO or sale of the company
The BSA Air will convert into equity immediately before the exit event occurs so that the SeedFAST investor can then sell those shares to the acquirer, alongside the existing shareholders.
4: If the company goes into liquidation
If things don't work out and the company shuts down then the BSA Air will convert into shares automatically just prior to that event, so that the BSA Air holder becomes a shareholder and can make a claim on the company assets, along with other shareholders.