Guide · EasyCofounder
BSA AIR: investing without setting the valuation yet
Inspired by instruments used abroad, the BSA AIR has become common in French seed rounds because it is quick and inexpensive to set up. This guide explains how it works, the parameters that really matter, its advantages and pitfalls for founders, and how it compares with a standard equity round. It is useful for any founder raising money for a French company, or dealing with investors used to French practice.
Updated on 6 min readBy the EasyCofounder team
In short
- The BSA AIR is a French share warrant used by startups raising small amounts.
- The investor pays now and receives warrants that convert into shares at a future round, with a discount and often a valuation cap.
- It avoids valuing the company today, but moves the negotiation onto the discount and the cap.
Diagram
From BSA AIR to share conversion
A BSA AIR lets an investor put money in now without setting a valuation. Conversion into shares only happens later.
1. Signing and payment
The investor pays in the funds and receives warrants, not shares yet.
2. Waiting period
No valuation is set and the cap table and voting rights do not change.
3. Trigger event
Usually the next priced round, or another case set in the contract (sale, maturity date).
4. Conversion into shares
The warrants turn into shares at the round price, with the discount or cap set in the contract.
Conceptual diagram. The discount, valuation cap and conversion cases are set by each contract.
Contents
What is a BSA AIR and how does it work?
A BSA AIR is a share subscription warrant that the investor buys by paying the full amount of their investment immediately. They only become a shareholder later, when the warrant converts.
- 1The shareholders authorise the issue of the BSA AIR and set its terms: discount, any cap, conversion events and deadline.
- 2The investor subscribes for the warrants and pays the money to the company, which can use it straight away.
- 3At a later funding round, the warrants are exercised and the investor receives shares at a price calculated from the price of that round.
- 4If no round takes place before the deadline, the contract generally provides for conversion at a valuation set in advance or on other terms.
Under French law, a BSA AIR is a share warrant, one of the securities giving access to capital that joint-stock companies may issue under article L228-91 of the Commercial Code. The “AIR” part is a market practice, not a separate legal category.
Discount, cap, floor: which parameters should you negotiate?
The whole value of a BSA AIR comes down to a few parameters, which determine the price at which the investor will join the cap table.
| Parameter | Role | Effect for the founders |
|---|---|---|
| Discount | Reduction applied to the price of the next round | The bigger it is, the more shares the investor receives |
| Valuation cap | Maximum valuation used for the conversion | A low cap protects the investor and dilutes the founders more |
| Valuation floor | Minimum valuation used for the conversion | Protects the founders if the next round is priced low |
| Conversion events | Funding round, sale, deadline | Defines when and how the investor becomes a shareholder |
| Deadline | Conversion due date | Avoids an uncertain situation dragging on |
When several mechanisms coexist, the contract generally states that the investor benefits from whichever of the discount and the cap is more favourable to them. That is the scenario to model first.
What are the advantages and limits for founders?
The advantages
- Quick to set up, with lighter documentation than a standard capital increase.
- The money arrives straight away, without waiting for every investor in the round to be on board.
- The valuation is not fixed at a time when the company still has little evidence to show.
- Investors do not immediately become shareholders, which keeps governance simpler in the short term.
The limits
- Dilution is postponed, not removed, and it can turn out higher than expected if the cap is low.
- Several successive BSA AIR with different parameters make the cap table hard to read.
- Investors in the next round will scrutinise these conversions and may ask to revisit some of their terms.
- The applicable legal and tax treatment depends on how the contract is drafted, hence the need for a template reviewed by a lawyer.
BSA AIR or capital increase: which should you choose?
| BSA AIR | Capital increase | |
|---|---|---|
| Valuation | Set later, framed by the discount and the cap | Set today |
| Investor status | Warrant holder until conversion | Shareholder as soon as it completes |
| Time and cost | Generally shorter and lower | Generally longer and higher |
| Clarity of dilution | Uncertain until the next round | Known immediately |
| Typical use | Small tickets, bridge rounds, business angels | Structured round with a lead investor |
The BSA AIR works well for a modest round with a few business angels, or to fund a few months between two rounds. A capital increase is often still preferable for a larger round led by an investor who wants specific rights.
Our guide to startup valuation helps you decide whether to set the value now or postpone it, and the pre-seed funding guide places the BSA AIR among the other sources available at the start.
How do you set up a BSA AIR properly?
- Start from a recognised template and have it adapted by a lawyer used to working with startups.
- Model the conversion under several funding scenarios, using the proposed discount and cap.
- Check that the articles of association allow the issue and follow the shareholders’ decision-making rules.
- Align the parameters if several investors subscribe at the same time.
- Record the BSA AIR in the fully diluted cap table as soon as they are issued.
- Explain clearly to each investor how it works, the deadline and the risks.
A startup raises money from four business angels through BSA AIR signed months apart, with different caps. At the seed round, the lead fund finds a complicated conversion and asks for the terms to be aligned, a negotiation that could have been avoided with common terms from the outset.
Frequently asked questions
What does BSA AIR stand for?
BSA AIR stands for bon de souscription d’actions avec accord d’investissement rapide, a share warrant with a fast-track investment agreement. It is paid for immediately by the investor and converts into shares at a future event, most often a funding round.
Is a BSA AIR repayable?
In principle, no. The investor takes a shareholder-type risk and only gets their money back if the company grows in value, although the exact terms depend on the contract signed.
Does a BSA AIR dilute the founders?
Not when it is signed, but it does dilute them when it converts, on top of the dilution from the next round. That is why it should go into the fully diluted cap table as soon as it is issued.
What is the difference between a BSA AIR and a SAFE?
The SAFE is an instrument that originated in the United States, and the BSA AIR follows the same logic. The BSA AIR is adapted to French company law, and its precise terms vary from one contract to another.
Glossary
- BSA AIR
- A French share warrant with a fast-track investment agreement, converted into shares at a future event.
- Discount
- A reduction applied to the price of the next round to set the conversion price.
- Valuation cap
- The maximum valuation used to calculate the conversion, in the investor’s favour.
- Valuation floor
- The minimum valuation used to calculate the conversion, in the founders’ favour.
Sources
Official texts and reference pages used for this guide
- French Commercial Code, Article L228-91 (Légifrance)
- Bpifrance Création, share subscription warrant (BSA)
- Bpifrance Création, raising equity funding
These are French official sources: the rules described apply to companies governed by French law.
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Further reading
- Pre-seed fundingRaising a pre-seed round: how it differs from seed, early-stage funding sources, what investors look for at this stage and the mistakes to avoid.
- Valuing your startupStartup valuation explained: pre-money and post-money, how to work out the stake you give up, early-stage methods and how to negotiate without selling cheap.
- Finding angel investorsHow to find an angel investor: what they bring, when to approach them, where to meet them, how to convince them and how their investment works.
- Building your cap tableA startup cap table: what it contains, how to build it and keep it up to date, diluted vs fully diluted views and the mistakes that worry investors.
About this guide
This guide was written by the EasyCofounder team — a platform that connects founders, talents and startups — and was last updated on November 9, 2026. It draws on common startup practice and on the questions our members ask.
How we write, review and update our guides is explained on our About page.
It provides general guidance and is not legal, tax or financial advice. For your own situation, consult a qualified professional (lawyer, accountant) and the official resources available in your country.