How should we split equity amongst a founder and a single investor?

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JASON LEMKIN

Well there are no perfect answers here … start-ups in the early days are basically all worth $0. You’ve accomplished nothing. You have no revenue. No customers.

But most professional U.S./Silicon Valley-style VCs and angels get worried if you sell much more than 30–33% of the company in the first round. 40% maybe if it’s a lot of money. Because there just won’t be enough left for the founders after the subsequent rounds of dilution.

Ideally, find a way to sell no more than 25% in the first round.

But.

Don’t fail just because you didn’t raise that extra $25k.

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Published on March 20, 2017
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