BSA Air (French SAFE equivalent)

The BSA Air is a French-law seed financing instrument, designed as the local equivalent of the SAFE (Simple Agreement for Future Equity). Based on the share subscription warrant, it lets an investor put money in immediately in exchange for the right to subscribe shares at a future financing round, on price terms fixed in advance as a valuation cap and a discount.

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The word Air refers to the idea of a rapid investment agreement (accord d'investissement rapide): like the SAFE, the BSA Air avoids negotiating the Pre-money valuation at the seed stage, deferring it to the next round. It differs, however, from a BSPCE (French startup warrant), reserved for the incentivisation of employees and managers, and from a Convertible bonds, which remains debt with a maturity. The BSA Air, by contrast, embodies a deferred equity contribution.

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For example, a startup raises 150,000 CHF in BSA Air with a valuation cap of 3 MCHF. The funds are collected immediately, but the shares are issued only at the next financing round, at a capped price, which avoids negotiating the valuation at the seed stage.

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Its appeal lies in its speed of implementation and flexibility, valued by young companies raising their first funds. Like any convertible instrument, it calls for particular attention to the future dilution it generates, to be modelled from the outset in the Cap table to avoid surprises at the next round.