Ask HN: What are convertible notes when related to startups?

I've seen various mentions recently of convertible notes when discussing venture capital deals, but I'm not sure what that means. I've looked around a bit, and I can't find a brief description of how they're used or what they really are. It looks like in general terms they're considered more startup-friendly than traditional VC during funding but I'm not sure why this is or how such a deal would work. From reading about them, it sounds basically like an option that you can also convert into cash rather than stock. Given this, could they be used for employee remuneration in place of options under certain circumstances? What would the tradeoffs here be?