Issuing a convertible note to raise capital

Raise capital without giving away equity before your business is valued.

You need investment capital to grow, but the timing is not right to price your equity. We will help you issue a convertible note that brings in the funding you need now, with equity conversion happening later on better terms.

What is a convertible note and how does it work?

A convertible note is a short-term debt instrument that converts into equity at a later date, typically when you raise a priced funding round. It lets you access capital now without locking in a valuation, giving both you and your investor a clear framework for the eventual conversion.

How does a convertible note differ from a standard loan?

A convertible note is short-term debt that converts into equity at a later date, usually when a priced investment round occurs. Unlike a standard loan, repayment is typically deferred until conversion. This means you can access capital now without needing to agree on a company valuation upfront.

What is a valuation cap and why does it matter?

A valuation cap sets the maximum valuation at which an investor’s note will convert into equity. It protects early investors if your company grows substantially before conversion. We will help you negotiate a cap that reflects your current stage and keeps you well positioned for future rounds.

What happens if the note is not converted before its maturity date?

If no qualifying investment round occurs before the maturity date, the note may convert at an agreed valuation, be repaid, or the parties may agree to extend it. We will draft your note with clear provisions for each scenario so all parties know their position from the start.

How long does it take to issue a convertible note?

Once the key terms are agreed with you and your investor, we can typically issue a convertible note within 5 to 10 business days. The timeline depends on the complexity of the terms and how quickly both parties review and sign.

Access investment capital without pricing your equity too early.

Protect your ownership stake with clearly documented investor terms.

Close your funding round faster with a proven capital structure.

Want to understand your options before committing?

Before we get started, let us walk you through how a convertible note works and whether it is the right structure for your raise. Book a no-obligation call with one of our lawyers today.

Don't give away your business before you know what it's worth.

You need capital to grow, but a traditional loan adds pressure you do not need, and giving equity away now locks in terms that may not reflect your business’s real potential. You need a structure that gets money in the door today without foreclosing your options for tomorrow.

We will assist you to issue a convertible note that brings in the capital you need, with equity conversion deferred to a future funding round.
We will negotiate investor terms including a discount rate, valuation cap, and maturity date that protect your interests.
We will ensure the note is correctly executed and meets all applicable legal requirements.

You have built something with real potential. Don't undervalue it.

You are at a pivotal stage in your business. An investor is ready to commit. But agreeing on equity terms before you have completed your next milestone could mean locking in a valuation that sells your business short. You need a way to take the investment and keep your options open.

What's included in your convertible note service

Vague terms today can cost you significantly tomorrow.

You have an investor ready to commit, but without a properly documented convertible note the conversion mechanics are unclear, the terms are open to dispute, and you may end up giving away far more equity than you intended when the note converts. Proceeding without clear legal documentation is one of the most avoidable and costly mistakes an early-stage founder can make.

Here is how we put you in control of your capital raise.

We will draft a clear, legally sound convertible note that sets out the investment amount, discount rate, valuation cap, conversion triggers, and maturity date. When the time comes to convert, you will know exactly where you stand. You will have secured the capital you need without compromising your position for future funding rounds.

Your path to securing capital

Follow these three steps to raise capital on your terms.

Talk to us

Speak directly with one of our experienced capital raising lawyers. We will review your situation, understand your funding needs, and explain your options clearly.

Structure your note

We will design a convertible note that reflects your capital requirements and protects your ownership position. We will also review any investor term sheets before you commit.

Close with confidence

We will draft and issue the convertible note, ensuring all terms are clearly documented and all legal requirements are met.

Experienced capital raising lawyers who understand early-stage business.

We know that raising capital is one of the most important decisions you will make as a founder, and one of the most stressful. Getting the structure right matters as much as getting the money in. Our team includes commercial lawyers with deep experience in startup financing, venture capital structures, and capital raises across a range of Australian industries. We have helped numerous early-stage and growth-stage businesses issue convertible notes that protect their interests while giving investors the confidence they need to commit.

We understand you want to know the cost, before we get started.

We will map out our process, from beginning to end, so you know what the journey will look like before you get started.

We will provide you with a clear and detailed Work Proposal covering each step along the way.

Our fair fees are all-inclusive. No hidden costs for telephone calls, emails, photocopying, couriers, or coffee.

Our great lawyer guarantee

We want to be part of your team over the long term. We achieve this by adhering to these core principles:

Take the time

We listen carefully to understand what you want to achieve. Then we thoroughly explain our advice and step you through the documents. You can be sure you know the full consequences.

Share our knowledge

We will pass on as much knowledge as we can, so you can make your own informed decisions. We want to make you truly independent.

Stick to our knitting

We only do what we're good at. You can be confident that we know what we're doing and don't pass on the cost of our learning.

Work as one team

Someone will always be available to answer your questions, or point you in the right direction. You will also benefit from a range of perspectives and experience.

Fair pricing

For advice and documents, we provide a fixed or capped quote so you don't take price risk. If you're in a dispute, we map out the process and costs so you know what to expect.

It's your show

We're not in this for our egos. We're in it for a front row seat to witness your success.

Ready to raise capital on your terms?

Speak with one of our experienced lawyers today. We will help you structure a convertible note that protects your ownership and gets capital into your business quickly.

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