Discount Rate (Convertible)
A percentage reduction on the next round’s share price given to convertible investors.
A discount rewards early convertible investors by letting them convert at a lower price than new round investors — typically 10–25%. It compensates them for backing the company earlier and at higher risk.
Examples
A 20% discount lets an ASA holder buy shares 20% cheaper at conversion. — A note has both a cap and a discount, applying whichever is better.
How it relates to The Startup Foundry
The Foundry helps you set discounts that attract early backers without over-diluting.