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My understanding of a convertible note is a loan that automatically converts into equity upon the closing of a Series A round. So what would happen if you get a convertible note, you grow fast and then you don't need the series A round? Do you have a convertible date in the terms to avoid that situation? |
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Convertible notes typically have a maturity date at which they become payable to the holder. So, if they're not converted before the maturity date, the issuer has to pay cash. But, you'd have to look at what the note itself says. Sometimes, they convert into common stock at maturity. |
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