Episode Details

In this special episode, we bring you a practical, high-context walkthrough of early-stage investing hosted by the San Diego Angel Conference (SDAC). With insights from the Pillsbury ECVC legal team and SDAC organizers, this session offers angel investors - both new and experienced - a clear breakdown of key financing instruments like SAFEs, convertible notes, and priced equity rounds.

We cover the structure and implications of different entity types (C-Corps, LLCs, S-Corps), the nuance behind valuation caps and discounts, the benefits of pro rata rights, and the tax advantages of Qualified Small Business Stock (QSBS). Whether you’re gearing up for Fund 8 or thinking about writing your first check, this session equips you with the frameworks and real-world insights you need to invest smarter.

Key Topics Covered

* Why SDAC is building year-round investor education & networking events

* Overview of startup legal structures: LLCs vs. C-Corps (and why Delaware still leads)

* What investors should understand about SAFE agreements

* How post-money valuation caps really work (and how they differ from discounts)

* Why side letters can protect your upside: pro rata, info rights, MFNs, and more

* How convertible notes differ from SAFEs and when they might be preferable

* Real red flags on cap tables and what they tell you about a company’s past

* What to know about Zombie SAFEs (and how to avoid them)

* Tax advantages of Qualified Small Business Stock (QSBS) and recent updates to eligibility

* The evolving dynamics of angel rounds, bridge financing, and recapitalizations

Links & Resources

* San Diego Angel Conference Website

* Qualified Small Business Stock Overview – IRS