It would not make sense to structure it as a SAFE security as then it would be a tiny percentage of the company at Series A when it converts, messes up the entire economics.
The purpose (as I see it) for SAFE, just like convertible notes, is that early stage startups are hard to value. At Series A you have a value and subsequent raisings can use that as a benchmark for up/down rounds. You also tend to have VCs etc take liquidation preferences and such like, which dilute the benefits of a convertible note.
The initial $20k(ish) for 6-7% of the company is where the real value for Y-combinator kicks in, if that was in the form of a SAFE, using a 25% discount to a $5m Series A valuation at $4m would mean that Y-combinator owned just 0.5% for their investment of $20k + value add.
I imagine the $80k convertible note should be a SAFE though?
