Frequently asked questions
breathermae
Friends and Family Investment Opportunity FAQs
Q: What is a seed funding round?
A: A seed funding round is an early stage of raising capital to support a startup’s growth. It typically involves raising funds from close networks, like friends and family, and is used to develop the company’s product, expand its team, or enter the market.
Q: What does it mean to invest in a startup?
A: Investing in a startup means providing capital in exchange for a potential return in the future. This return could be in the form of ownership equity, dividends, or profits, depending on the success of the startup.
Q: What is a SAFE (Simple Agreement for Future Equity)?
A: A SAFE is an agreement between an investor and a company. Instead of getting shares immediately, you get the right to receive shares in the future when a specific event occurs, like the next funding round or the company being sold.
Q: How does a SAFE work?
A: When you invest using a SAFE, you provide funds now, and in return, you’ll receive shares in the company later. This typically happens at a discount compared to the price at which new investors buy in the next round of funding.
Q: What are the benefits of investing via a SAFE?
A: SAFEs simplify the investment process and offer early investors a discount on future equity. This means you could receive more shares for your investment compared to later investors.
Q: Are there risks involved with investing in a startup?
A: Yes, investing in a startup carries significant risks. The company might fail, which could result in losing your investment. However, if the startup succeeds, the potential returns can be substantial.
Q: How do I know how many shares I will get?
A: The number of shares you receive will depend on the terms of the SAFE, such as the discount rate and the valuation cap. These terms determine how your investment converts into equity during a future funding event.
Q: When will I see a return on my investment?
A: Returns on startup investments are uncertain and can take months to complete. You will typically see returns if the company raises significant follow-up funding. In the case of Breathermae, we anticipate the Friends and Family seed round to run concurrently with our venture capital funding round starting July - 2024 and will close once our $4 million dollar funding goal is achieved.
Q: What happens if the company doesn’t raise more funding?
A: If the company does not raise additional funding or does not achieve a liquidity event, the SAFE might not convert into shares, and there might be no return on your investment.
Q: How can I get more information or ask questions?
A: You can request additional information or schedule a discussion by contacting us through our [contact form/scheduler link]. We're here to answer any questions you might have and help you understand the investment opportunity better.