What Is a KISS?
Direct answerA KISS, short for Keep It Simple Security, is a startup fundraising agreement created by 500 Startups (now 500 Global) to help early stage companies raise money before establishing a formal company valuation. Like a SAFE, a KISS allows an investor's money to convert into equity during a future priced funding round instead of determining ownership immediately.
There are two versions of the KISS. The Equity KISS works similarly to a SAFE and is not debt. The Debt KISS functions more like a convertible note because it includes an interest rate and a maturity date before eventually converting into equity. Both versions were designed to simplify early stage fundraising while giving founders and investors standardized legal documents.
For founders, understanding the KISS is useful because you may still encounter it when speaking with experienced investors or reviewing older fundraising documents. Although the KISS introduced several ideas that influenced modern fundraising agreements, most startups today choose the Y Combinator SAFE, which has become the more widely adopted standard.
Two versions, one goal
Imagine you're raising money for your startup, but you do not want to spend weeks negotiating what the company is worth today.
A KISS was created to solve that problem.
Instead of agreeing on a company valuation immediately, the investor provides funding today and receives the right to obtain shares later, usually when your startup raises its first priced round. At that point, the KISS converts into equity according to the terms agreed when the investment was made.
What makes the KISS slightly different from a SAFE is that it comes in two forms.
The Equity KISS behaves much like a SAFE because it is not debt. It simply waits for a future event before converting into shares.
The Debt KISS is different. Like a convertible note, it begins as a loan, earns interest, and includes a maturity date before eventually converting into equity if the agreed conditions are met.
Although both versions were designed to simplify fundraising, the startup ecosystem gradually adopted the Y Combinator SAFE as the preferred standard. Today, most founders are more likely to raise money using a SAFE than a KISS.
What 500 Global says, and what founders are actually asking
The KISS was introduced by 500 Startups as a standardized fundraising agreement designed to make early stage financing simpler for both founders and investors.
The official documentation explains that the KISS is available in two versions: an Equity KISS and a Debt KISS. Both are designed to postpone valuation discussions until a future financing round, while giving founders and investors a standardized agreement that is easier to understand and negotiate than traditional financing documents.
The KISS is not created by the SEC or established by law.
It is a market document developed by 500 Startups to simplify startup fundraising. Like the SAFE, it provides a standard framework for raising money before a company has established a formal valuation.
Understanding this distinction helps founders recognize that a KISS is simply one fundraising instrument among several. The important decision is choosing the agreement that best fits both the startup and its investors.
This question appears because the two agreements seem very similar. Both postpone valuation discussions until a future financing event, and both were designed to simplify early stage fundraising.
Experienced founders and investors often explain that while the agreements share many similarities, they are not identical. One commonly discussed difference is that the KISS includes provisions, such as a Most Favoured Nation (MFN) clause in certain versions, that are not included in the original Y Combinator SAFE. These differences can affect investor rights depending on the version being used.
Many founders assume every "SAFE-like" agreement works exactly the same.
In reality, standardized fundraising documents often share the same overall purpose while differing in important legal details. Even small differences in investor rights, conversion terms, or repayment provisions may affect how a future financing round unfolds.
The KISS played an important role in the evolution of startup fundraising by giving founders a simpler alternative to traditional convertible notes.
While many startups now default to the Y Combinator SAFE, founders may still encounter KISS agreements when reviewing older fundraising documents or working with investors who have used them before.
Understanding how a KISS works makes it much easier to compare fundraising documents and choose the agreement that best fits your company's needs.
Supporting today's fundraising standard
Cairnul is built around the Y Combinator SAFE, which has become the most widely used agreement for early stage startup fundraising.
When you create a fundraising round in Cairnul, each SAFE stays connected to the investor who signed it, the executed agreement, and the rest of your fundraising workflow. Investor records, fundraising milestones, and supporting documents remain organized together, making it easier to understand the progress of your round without relying on disconnected spreadsheets or email threads.
If your startup already has an older KISS agreement, understanding how it differs from a SAFE is an important first step before planning your next fundraising round. Small differences between the documents may affect investor rights and future conversion terms, so reviewing those agreements carefully helps founders make informed decisions as they continue raising capital.
Whether your company is reviewing historical fundraising documents or preparing to issue new SAFEs, keeping every agreement and investor record organized from the beginning creates a much clearer fundraising process.
Many founders think the KISS disappeared because there was something wrong with it.
That is not the case.
The KISS was created to simplify startup fundraising and was widely respected within the startup community. Over time, however, the Y Combinator SAFE became the document most founders and investors adopted, making it the de facto standard for many early stage fundraising rounds.
Another common misconception is that every KISS is the same.
It is not.
There are two versions of the KISS. The Equity KISS is not debt and shares many similarities with a SAFE. The Debt KISS includes interest and a maturity date, making it more similar to a convertible note. Understanding which version you are reviewing is essential before comparing it with another fundraising instrument.
Recognising these differences helps founders avoid assuming that every "simple" fundraising agreement creates the same rights and obligations.
Understand your fundraising agreement before signing
Learn whether your fundraising document is a SAFE, a KISS, or a convertible note.
Understand whether your KISS is an Equity KISS or a Debt KISS.
Compare conversion terms before accepting investment.
Review any investor rights that differ from other standard fundraising documents.
Keep signed fundraising agreements connected to the investors who signed them.
Organize fundraising documents, investor records, and important milestones together in one connected workflow.
Frequently asked questions
A KISS, or Keep It Simple Security, is a fundraising agreement created by 500 Startups (now 500 Global). It allows startups to raise money before establishing a formal valuation, with the investment typically converting into equity during a future priced funding round.
Not exactly.
Both agreements are designed to simplify early-stage fundraising and delay valuation until a future financing round. However, the KISS includes features that differ from the original Y Combinator SAFE, and it exists in both Equity and Debt versions.
An Equity KISS is not debt and functions similarly to a SAFE.
A Debt KISS includes an interest rate and a maturity date, making it more similar to a convertible note before it converts into equity.
Although the KISS was well received when it was introduced, the Y Combinator SAFE gradually became the fundraising document most founders and investors adopted. Today, the SAFE is generally the standard agreement used in many early stage startup financings.
Yes.
The KISS is still a valid contractual fundraising instrument. However, many founders choose a SAFE because it has become the more familiar document for both startups and investors.
Cairnul is designed around the standard Y Combinator SAFE. If your startup has existing KISS agreements, understanding their terms will help you compare them with newer SAFE financings before your next fundraising round.
Keep every fundraising agreement connected
Cairnul helps founders organize investors, documents, and compliance in one place, so the whole raise stays clear from first sale to close. Join the waitlist to be among the first founders to run a cleaner, more organized round.
Join the waitlistDisclaimer. This content is provided for educational purposes only and does not constitute legal, tax, or investment advice. Fundraising rules, filing requirements, and fees may vary by jurisdiction and change over time. Always confirm current requirements with qualified counsel or the relevant regulator.