A common approach to seed-stage financing is to use a convertible instrument such as a SAFE or Convertible Note. While this is good advice in general, there are exceptions to the rule. One great time to have a priced round at the seed stage is when you have “smart” angels, such as former entrepreneurs or sophisticated investors. The reason is from these investors you can get a very clean, founder/company-friendly term sheet. Why does this matter? Well, the first priced round has a funny way of setting the expectations and baseline of terms of future financings. By locking in company-friendly terms now, you can push later investors to keep equivalent terms. This is a great hack to give you the upper hand in negotiations–in order to be fair to previous investors you need to have a very strong justification for the change. New investors will understand this and it’s hard to argue against. After all, they will be the existing investors in all future financings.