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Dictionary by pitch.dog
Valuation & conversion mechanics · Core

Liquidity event

Also called: exit event

ELI5

An event where owners may receive cash or tradable shares.

Used in conversation

“The SAFE has separate treatment for a liquidity event.”

Definition

A transaction such as a sale, merger or public listing that provides or may provide liquidity to security holders.

Here “Liquidity event” means: A transaction such as a sale, merger or public listing that provides or may provide liquidity to security holders.

Pitch context

You will see “Liquidity event” in fundraising decks, data rooms, term sheets and investor conversations when the discussion reaches valuation & conversion mechanics.

Why it matters: In valuation & conversion mechanics, a loose definition can change rights, obligations, approval, disclosure or enforceability.

Caution

Meaning, enforceability and required process vary by jurisdiction and agreement; this definition is not legal advice.

Connected terms

  • ExitThe search label “liquidity event” can route to both entries.
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Sources & evidence · 5

Direct term-level sources and supporting source families.