BSA AIR mechanism
The investor subscribes to warrants that will convert into shares at the next round, on the basis of predefined parameters (discount, valuation cap), without having to negotiate an immediate valuation.
→ Corporate · Sub-expertise
The BSA AIR (Accord d'Investissement Rapide, Rapid Investment Agreement) is the French instrument inspired by the U.S. SAFE: it allows funds to be raised within a few weeks without fixing the valuation, deferring dilution to the next funding round. We structure balanced BSA AIR instruments, calibrated on the key parameters (discount, cap, rate) to preserve founders' flexibility and remain attractive to investors.
→ What we cover
The investor subscribes to warrants that will convert into shares at the next round, on the basis of predefined parameters (discount, valuation cap), without having to negotiate an immediate valuation.
Calibration of the discount (10 to 30%) applied to the valuation of the conversion round, and of the cap to protect the investor in the event of a sharp rise in valuation.
Automatic conversion at the next qualified round (minimum amount), upon a full sale, at a longstop date, or in the event of liquidation.
Drafting of the BSA AIR agreement, the corporate issuance resolutions, the modeling table of conversion scenarios and the subscription undertakings.
Anticipation of the dilutive impact at conversion, coordination with the preferred shares of the following round, updating of the prospective cap table.
Management of a pool of several BSA AIR investors (business angels, family offices), harmonization of the terms, handling of individual conditions.
→ Our approach
01
Validation of the suitability of a BSA AIR versus a conventional round: amount raised, investor profile, urgency, prospects of the next round.
02
Negotiation of the discount, the cap, the conversion thresholds and the longstop date. Modeling of the impact on the cap table under several valuation scenarios.
03
Drafting of the BSA AIR agreement, holding of the authorizing extraordinary general meeting, issuance decisions, and collection of the subscription undertakings.
04
At the following round, calculation of the conversion according to the parameters, formalization of the capital increase and updating of the cap table.
→ Who we help
Raising EUR 300k in BSA AIR from business angels to finance six months of runway while a forthcoming Series A is being finalized.
First post-incorporation financing via BSA AIR to avoid fixing a premature valuation, with a protective cap for early-stage investors.
Coordination of BSA AIR subscribed by business angels with a simultaneous equity investment by a fund, by harmonizing the conversion conditions.
Fast raise within a few weeks to meet a cash need, without the long timeline of negotiating a term sheet and a shareholders' agreement.
→ Q&A
The BSA AIR is the French adaptation of the U.S. SAFE. The mechanism is similar: no fixed valuation, conversion at the next round with a discount and a cap. The legal structure differs: the BSA AIR is based on a share subscription warrant under French law.
The three key parameters: the discount (generally 15 to 25%) applied to the valuation of the following round, the cap (valuation ceiling for the conversion, which protects the investor), and the longstop date beyond which alternative conversion mechanisms apply.
It is particularly suited to seed rounds and bridge financings. For more structured rounds (Series A, B), a conventional round with a negotiated valuation is generally preferable, as it immediately fixes the dilution and the governance.
The agreement must provide for alternative conversion mechanisms: conversion at the longstop date on a predefined valuation, conversion upon a sale, possible repayment under certain conditions. Failing that, the investor may be left without liquidity.
→ Go further
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