How Much Do SaaS Founders Own When They IPO

SaaS founders — if and when you IPO, how much of the company will you own?

Many folks throw around a couple key checkpoints. The first one is founding teams should try to hold on to 51% of equity after the Series A raise.

That’s a fine goal (although many great companies don’t have that and still go on to wonderful outcomes). But how about at the end of the journey?

Disclaimer: this is not Carta data and it's only 34 companies. But I still find the info collected by Jason M. Lemkin at SaaStr fascinating.

Standout points:

1. The average ownership across the entire founding team at IPO was 22%.

2. The "first founder" (usually the CEO) had significantly more equity in companies with 2 co-founders (often about 2:1 ratio).

Now - there are significant outliers here. The founding teams at Atlassian, Klaviyo, and ZoomInfo all IPO'd with majority ownership. Atlassian at 75.4% is an outrageous mark, kudos to them!

If you remove the three high outliers, the key benchmarks look like:

• 75th percentile ownership across the founders: 22.3%

• 50th percentile: 17.1%

• 25th percentile: 14.4%

Does that feel like too much? Too little? The range is gigantic, from 75% down to 2%.

And it’s definitely possible that founders across the board took some money off the table with secondary sales, etc over the lifetime of the company.

Seems like every path to IPO is distinct enough that comparison is just an academic exercise. And hey, 2% of billions is still a lottery-level outcome.

Here's to this damn IPO market opening back up soon, for everyone's sake 🙏

#founders #startups #dilution #fundraising #IPO