article thumbnail

How to calculate the equity split between co-founders in a startup

The Next Web

So, let’s say that one founder puts in $100,000 in seed capital, that could be worth 20 percent of a seed stage company’s valuation. So, a fair split, would be closer to 60/40 in favor of the funding founder, when diluted for the cash. To me, that is no different than financing the business.

Cofounder 136
article thumbnail

Keep Term Sheets Simple for Quicker Cash to Spend

Startup Professionals Musings

When a company is at its earliest seed stage, the terms tend to be the least complex. As the company grows and the second or third group of investors comes in, the terms of each subsequent financing grow in size, scope, and the number of lawyers’ fingerprints on them. Anti-dilution protection.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

Finance Fridays: Getting Started – Allocating Equity and Founder’s Investment

Feld Thoughts

Finance Friday’s gets off the ground with today’s post by introducing you to an imaginary startup, the entrepreneurs that we’ll being following throughout the series, and their first challenges: splitting up the founders’ equity and addressing the case where one of the founders provides the initial seed capital for the business.

Equity 137
article thumbnail

A Primer on Angel Investment ‘Simple Term Sheets’

Startup Professionals Musings

When a company is at its earliest seed stage, the terms tend to be the least complex. As the company grows and the second or third group of investors comes in, the terms of each subsequent financing grow in size, scope, and the number of lawyers’ fingerprints on them. Anti-dilution protection.

article thumbnail

The Summer of Initial Coin Offerings

Seeing Both Sides

Instead I will make a few observations about how an investor might think about the impact of ICOs / token launches on the venture capital industry, in particular, and some of the downstream ramifications that need to wrestled with. Need for growth capital. Shift of value from equity holders to token holders. Fuzzy Governance.

article thumbnail

The Summer of Initial Coin Offerings

Seeing Both Sides

Instead I will make a few observations about how an investor might think about the impact of ICOs / token launches on the venture capital industry, in particular, and some of the downstream ramifications that need to wrestled with. Need for growth capital. Shift of value from equity holders to token holders. Fuzzy Governance.

article thumbnail

Keep Term Sheets Simple for Quicker Cash to Spend

Gust

When a company is at its earliest seed stage, the terms tend to be the least complex. As the company grows and the second or third group of investors comes in, the terms of each subsequent financing grow in size, scope, and the number of lawyers’ fingerprints on them. Anti-dilution protection.