An MFN clause, common in SAFEs and convertible notes, guarantees an investor the same or better terms as any investor who invests later on more favorable terms, without having to renegotiate.
It's mostly used on early, informally-priced instruments like SAFEs, where a founder might raise from several investors over time at slightly different terms. An MFN clause protects an earlier investor from ending up with a worse deal than someone who invested later simply because the later investor negotiated harder.
Worth tracking every MFN clause a company has granted, since exercising one can quietly change the terms, and effective dilution, of an instrument that already closed. A founder juggling several SAFEs with MFN provisions can end up with a materially different cap table than the one they thought they'd agreed to.
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