Latest / The Series A Show with Fexingo: Early-Stage Funding, Pitch Decks, and Startup Milestones
Why Startups Are Trading SAFEs for Earnout Agreements
Lucas and Luna dive into a quiet shift in early-stage deal structure: earnout agreements. Instead of the standard SAFE or priced round with a valuation cap, a growing number of startups—especially in AI and biotech—are tying founder payout to hitting specific revenue or product milestones. Lucas walks through how earnouts work, why they appeal to both founders and investors in a volatile market, and what it means for cap table complexity. He references a recent $12 million Series A for a robotics startup that used a three-tranche earnout tied to FDA clearance and commercial rollout. Luna…
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