This content is for educational purposes only and should not be considered tax, financial, or legal advice. Most early-stage founders consider two types of securities to receive investment: the convertible note (and its siblings: SAFE, KISS, and other notes); and equity-based investment, typically via preferred stock, AKA “priced round”. One of the main differences is the application of a valuation cap vs. a valuation. A valuation cap is: Used for convertible notes and other