An MFN clause in a SAFE or convertible note gives the early investor the right to elect terms granted to any subsequent investor on a similar instrument. If a later SAFE has a lower cap, a higher discount, or other better economics, the MFN holder can swap their terms in.
MFN clauses protect early investors from being undercut by later, friendlier deals, but they also make the cap table unpredictable. Founders who issue too many MFN-bearing SAFEs lose the ability to negotiate flexibly with later check-writers.