Mathematical vs. Economic Dilution of Startup Equity: Thinner Slices of an Extra-Large Pizza
Gust
APRIL 11, 2014
Entrepreneurs frequently think of equity primarily in terms of percentages such as 50/50 or 40/40/20 — not necessarily a bad idea at inception, or even throughout the lifecycle of a traditional business, such as real estate, where cash distributions, capital contributions, and allocations of profit or loss for tax purposes can be made accordingly.
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