I do really like the example you gave for how you can frame it but I’m not too sure how I feel about tranche funding overall. From VC sentiment I’ve heard in the past, my understanding is that tranching was very popular back in the day, but isn’t so common anymore and can be seen as a red flag.

I think it makes sense as to why it can be too risky — aside from the messy cap tables it can sometimes create (especially when founders raise a buncha SAFEs at a buncha different vals). To me, it kinda goes against what a good investor should be doing; which is having conviction on the founders/team. I think it just builds a rocky foundation for a founder/investor relationship right from the get-go with too many variables up in the air that might still make things go awry. And it may just be an easy way to force yourself into thinking about short term milestones and have to still do more work overall.

But idk, how you framed it is still resonating in some ways. I think in my head it can only make sense if it’s for bringing on a pre-seed angel and you already have >90% likelihood leads committing in the near term. The benefit would be to limit dilution and the time spent in the next round talking to that angel discussing terms and getting them to wire.

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