Question 1

What legal documents do I need for a Pre-Seed round?

Accepted Answer

For a Pre-Seed round, you need: founder agreements with vesting, a clean cap table, SAFE or convertible note, NDA, and IP assignment from all founders.

Question 2

What's the difference between a SAFE and a convertible note?

Accepted Answer

A SAFE has no maturity date or interest — it converts to equity at the next priced round. A convertible note is debt with a maturity date and interest rate. SAFEs are more founder-friendly.

Question 3

How much does it cost to hire a lawyer for a Seed round?

Accepted Answer

Legal fees for a Seed round in Europe range from €5,000-€25,000. AI tools like Outlex can reduce these costs by 50-70%.

Question 4

What is the 'option pool shuffle'?

Accepted Answer

It happens when investors require the option pool to be created from the pre-money valuation, diluting founders. Always negotiate the pool size and whether it's pre or post-money.

Question 5

Do I need a lawyer to review a term sheet?

Accepted Answer

Yes, highly recommended. Term sheets contain critical clauses on liquidation preferences, anti-dilution, and board composition that impact your control and upside.

Question 6

What's the typical timeline to close a funding round?

Accepted Answer

A typical round takes 3-6 months: 1-2 months of preparation, 1-2 months of pitching and due diligence, 2-4 weeks for negotiation and closing.

Fundraising legal guide for European companies

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