How Much of Your Company Will You Own After Every Round

Real data for founders on how much of your company you will own after every venture round. Taken from 10,937 US startups.

𝗖𝗹𝗲𝗮𝗿 𝗧𝗮𝗸𝗲𝗮𝘄𝗮𝘆𝘀

• Software founders retain more of their companies than deep tech founders do. Deep tech here defined as Biotech, Hardware, Energy sectors.

• Very, very few founders actually own more than 50% of the company as a group following the Series A round, even though that benchmark is often tossed around as "correct"

• Founders + Employees often 𝗱𝗼 𝗼𝘄𝗻 𝗺𝗼𝗿𝗲 𝘁𝗵𝗮𝗻 𝟱𝟬% after the A round.

• Employees will collectively be allocated more than founders by Series C or so. However this is a bit misleading as much of the option pool won't be exercised so that will return to the founders (often, not always) over time.

• When can VCs fire founders? Typically Series B-ish. But the actual incidence rate of VCs wanting to fire founders is quite low. They are usually investing because of the founders, shocking I know :)

𝗧𝗵𝗼𝘂𝗴𝗵𝘁𝘀

Will AI change the dilution rates drastically? It could be that 10% dilution in seed or A becomes more common if the business needs less money to scale and can anticipate (and this is the tough part) less capital needs at every stage.

Maybe deep tech and software dilution becomes more equal over time?

Maybe employee pools shrink because founders are hiring agents not people?

Maybe employee pools grow because founders are compensating the few people they do end up hiring with bigger stakes?

So much open to change!

#startups #founders #dilution #equityownership