Question
A founder owns 100% of her startup. She is offered an equity investment by a VC investor, accepts, and eventually, undergoes two more rounds of
A founder owns 100% of her startup. She is offered an equity investment by a VC investor, accepts, and eventually, undergoes two more rounds of financing, each time by another VC investor. The financing events are as follows: VC investor 1 steps in with $0.5 million at a pre-money value of $2 million; later, VC investor 2 contributes $3 million at a pre-money of $7 million; and, finally, VC investor 3 coughs up $5 million at a pre-money of $20 million. At that point, i.e. Round 3, what is the worth in stock of the founder, of VC1, of VC2, and of VC3? What percentage of the company does each own?
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