#ConvertibleDebtNotes are loans that can be converted into company equity at a later date. For instance, if you invest $10,000 in a startup through a convertible note, the company owes you $10,000 plus interest.
Instead of repaying the loan, the company may offer to convert the debt into shares of stock when it raises a round of funding.
If the company raises $1 million and you hold a convertible note, your $10,000 might convert into equity, giving you a stake in the company's ownership.