Everybody knows that when you raise money at a startup your ownership percentage of the company goes down. The goal is to have the value of the startup go up by enough that you own a smaller percentage of a much larger business and therefore your total personal value goes up. The simplest way to ...
From: Simeon Simeonov, Technology Partner, Polaris Venture PartnersFounders often ask me, “If I own X% after my first investment round, how much will I be diluted through financings until exit?”. A follow-on question is: “How much option reload will I get to compensate for that dilution?” There are rules of thumb but there is no ...
My firm just published our Spring 2008 Entrepreneurs Report, summarizing trends in the venture-backed technology market over the last several years. Among the statistics is this chart showing the average founder equity dilution in Series A and Series B financings broken down by industry.
