CFEA is a hybrid of an FEA (future earnings agreement) and a SAFE note.
A Future Earnings Agreement is an instrument where you pay back a fixed % of your earnings for a set period of time, and repayments are deferred until you are earning above a minimum income threshold.
We've partnered with Stepex who will be servicing our Future Earnings Agreements. They will be helping us with checking your personal financial situation to determine if you're eligible for an FEA.
First and foremost, we look for perseverance, drive, EQ and domain expertise. Have you started other businesses before? We are looking for Validation - how are you continuing to test and prove your case and what have you learnt from it? We need to know you are the right person to bring improvements to x industry with x solution? Are you building something capital efficient, scalable and innovative? From a traction standpoint, we liked to see an idea that has been pretotyped (not prototyped).
£10,000 - £30,000
At each step, you will be notified by email and process is as follows.
Everything is run though our Blueocean portal, which is powered by our very own unique database. Everything from automated response to status updates comes through this proprietary platform.
We share a database with StepEx that allows us to see everyone’s eligibility for FEA's. In order for you to proceed with your application, you’ll need to agree to share those financial history with StepEx who will check your eligibility for the FEA.
To your business bank account.
Generally it is because:
In every rejection email, we will specify why you got rejected (instead of sending some boilerplate rejection email) so you know where you can improve.
That being said, take our advice with a grain of salt.
If we reject you once then make sure your situation has changed before applying again.
Also keep in mind if you’ve already received a CFEA from us, it may reduce your ability to get more funding.
At a future the Qualifying Round, the SAFE note gets activated and the FEA gets cancelled.
Updise Down VC investment into the investee company will convert at a 20% discount to the valuation at that round.
Alternatively, if the valuation of the company is greater than £5m, Upside Down VC investment will convert at a valuation of no more than £5m without the 20% discount.
The shares issued to Upside Down VC upon conversion must hold the same rights and be of the same share class as all other investors in the round.
Where there are multiple share types, Upside Down VC shares will convert in to the same class of shares that are to be held by the primary investor in that round (i.e. the third party investors that contributed the greatest amount of funding to the funding round)
Lastly, Upside Down VC shall have a pro-rata right, but not an obligation, to participate by further investing in the company at the Qualifying Round.
