Every founder should look into the “Safe Financing Documents” by Y Combinator.
http://ycombinator.com/safe/
The Safe (simple agreement for future equity) is intended to replace convertible notes in most cases, and we think it addresses many of the problems with convertible notes while preserving their flexibility. In addition to being simpler and clearer, we intend the safe to remain fair to both investors and founders.
These are new, so not all investors accept them yet. But they will eventually become a viable alternative to traditional convertible notes.
Steve
Interesting indeed. I just wrote a review of SAFE and compared it to the familiar Convertible Note. You can read it here: http://wp.me/p2EfeJ-j0