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A Seed investment agreement outlines the terms when early-stage investors provide capital to Saudi startups in exchange for equity. It's the foundational legal document that protects both founders and investors during the critical first round of external funding, typically ranging from SAR 100,000 to 2 million.

Under Saudi commercial law and CMA regulations, these agreements specify key details like valuation, share percentages, investor rights, and founder obligations. They often include provisions for board seats, future funding rounds, and exit strategies while ensuring compliance with Shariah principles that govern Saudi business transactions.

Use a Seed investment agreement when your Saudi startup is ready to accept its first significant external funding, typically after exhausting personal resources but before seeking larger Series A rounds. This agreement becomes essential once you've found investors willing to provide capital in exchange for equity, usually between SAR 100,000 and 2 million.

The timing is crucial - implement this agreement before any money changes hands, ideally during final investment negotiations. It's particularly important when bringing in multiple investors, establishing board seats, or when investors request specific rights like future funding participation. Saudi regulations require proper documentation of all equity transactions, making this agreement legally necessary for fundraising.

• Simple Equity Agreement: Basic version offering straightforward equity in exchange for capital, commonly used by early-stage Saudi startups seeking their first investors
• Convertible Note Agreement: Combines debt and equity features, allowing investment to convert to shares at a later valuation
• SAFE Agreement: Simplified agreement for future equity, gaining popularity among tech startups in Saudi's emerging venture ecosystem
• Shariah-Compliant Structure: Modified to ensure compatibility with Islamic finance principles, featuring profit-sharing mechanisms instead of interest
• Multiple Investor Agreement: Structured for rounds with several participants, including specific rights and coordination provisions

• Startup Founders: Primary negotiators who seek capital while protecting their company's interests and future control
• Angel Investors: High-net-worth individuals providing early-stage capital, often bringing expertise alongside funding
• Legal Counsel: Saudi-licensed attorneys who draft and review agreements to ensure Shariah compliance and CMA regulations
• Company Secretary: Maintains corporate records and ensures proper documentation of equity transfers
• Financial Advisors: Help structure deals and assess valuation terms for both parties
• Board Members: Review and approve the agreement terms, especially when new board seats are part of the deal

• Company Details: Gather accurate corporate registration documents, commercial registration number, and shareholding structure
• Investment Terms: Define investment amount, valuation, equity percentage, and any special rights or restrictions
• Investor Information: Collect KYC documents, proof of funds, and investment vehicle details (personal or corporate entity)
• Compliance Check: Verify alignment with Shariah principles and CMA regulations for private placements
• Board Approvals: Document formal board resolutions approving the investment terms
• Timeline Planning: Set clear milestones for funding tranches and completion deadlines
• Documentation Review: Use our platform to generate a compliant agreement that includes all required elements

• Party Details: Full legal names, addresses, and registration numbers of startup and investors
• Investment Terms: Precise investment amount, equity percentage, share class, and valuation details
• Shariah Compliance: Explicit statements ensuring agreement aligns with Islamic finance principles
• Rights & Obligations: Board representation, voting rights, and future funding participation terms
• Exit Provisions: Tag-along rights, drag-along rights, and transfer restrictions
• Warranties: Company representations about financial status and legal compliance
• Governing Law: Clear reference to Saudi law and CMA regulations as governing framework
• Dispute Resolution: Saudi arbitration or court jurisdiction specifications

A Seed investment agreement differs significantly from a Pre-seed Angel investment agreement in several key aspects, though both are used for early-stage startup funding in Saudi Arabia.

• Investment Size: Seed rounds typically involve SAR 100,000-2 million, while pre-seed deals are usually smaller, under SAR 100,000
• Investor Profile: Seed agreements often involve multiple professional investors or small funds, whereas pre-seed deals usually involve individual angel investors
• Documentation Complexity: Seed agreements require more comprehensive terms, investor rights, and governance provisions, while pre-seed agreements are typically simpler
• Valuation Approach: Seed rounds usually involve formal company valuations, while pre-seed often uses convertible instruments or simplified valuation methods
• Regulatory Requirements: Seed agreements face stricter CMA oversight and Shariah compliance requirements due to their larger size and broader investor base