article thumbnail

Seed Stage Funding 101: What it Is & How it Works

The Startup Magazine

Seed capital is a component of the initial investments made in young businesses. Some return value must be offered to the investors for startup seed funding to be considered acceptable. This could be a proportion of the company’s equity or investment; in other instances, it could be a portion of its later-stage profits.

article thumbnail

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

The Next Web

There are a lot of variables to go into calculating a fair equity split a startup team. 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. How do you manage your equity split in your company?

Cofounder 136
Insiders

Sign Up for our Newsletter

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

article thumbnail

NextView’s Greatest Hits

View from Seed

What Are Your Valuation Expectations? But mainly we did it because these corporate VCs were among the only groups willing to invest at PayPal’s somewhat inflated post-money valuation, during the middle of the dot-com crash when traditional VCs pulled back sharply and other sources of funding were constrained.” ” (Rob Go).

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

Keep Term Sheets Simple for Quicker Cash to Spend

Startup Professionals Musings

Based on my experience, and the book “ Attracting Capital from Angels ” by Brian Hill and Dee Powers, here are some key clauses that any investors expect on the first term sheet for the investment you need: Set the price. The price is the percent of ownership given to the investor, calculated as “investment/post-money valuation.”

article thumbnail

Knowledge Is Power: Convertible Note Financing Terms, Part I

Gust

The second reason, perhaps nearer to both entrepreneurs’ and investors’ hearts, is the ability to punt on valuation at a stage in which it is hardest to determine using any objective criteria. A group led by Ted Wang is trying to change that with the innovative Series Seed documents , which I’ll discuss in a future post.)

Finance 178
article thumbnail

A Primer on Angel Investment ‘Simple Term Sheets’

Startup Professionals Musings

According to Attracting Capital from Angels by Brian Hill and Dee Powers, here are some key clauses that angel investors expect on the first term sheet for the investment you need: Set the price. The price is the percent of ownership given to the investor, calculated as “investment/post-money valuation.” Define equity type.