Get the most out of your Inc. online experience by registering and joining the Inc. community today. Get access to all Inc.com content and priority invites to free Inc. networking events in your area.

Login using:


Or login directly through Inc.com

How much equity will venture capitalists want in my start-up?

 

Internet in Business mentor Bradley Feld responds to the following question from an inc.com visitor:
What is the typical composition of a start-up's stock distribution betweenfounders and employees and venture capitalists?

Bradley Feld responds:The initial split of stock among venture capitalists, founders, and employees can vary dramatically based on several factors. These may include but not be limited to:

  • The experience of the founders
  • The progress of the company
  • The amount of money the founders are willing to invest in the company
  • The quality and development of the company's marketplace

While there are no definitive numbers, in my opinion you should expect that most VCs will be interested in buying between 20% and 40% of the company inthe first round.

Copyright © 2000 inc.com

Interested in learning more about sharing company equity? Check out the following inc.com articles:

"Know Your Options"
"Motherhood, Apple Pie, and Stock Options"
"CEO's Notebook: Stock Options and Equity"

Read more:

  • 6 Secrets to a Successful Start-up
  • How I Hire the World's Best Employees
  • What's for Dinner? Ask These 7 Start-ups

    • Sign-up for our Start-up Newsletter