Paul Buchheit: Equity math for startups (sometimes 0.1% equals $138 million)

http://paulbuchheit.blogspot.com/2007/03/equity-math-for-startups.html

by paul • 19 years ago

30 7 19 years ago

paulbuchheit.blogspot.com

dougw• 19 years ago

Great post. Thanks paul!

patrick• 19 years ago

Very informative!

gustaf• 19 years ago

Great writing paul!

chandrab• 19 years ago

This is one of the better posts I've seen on the topic..If you want to dive in deeper Brad Feld's blog series on term sheets. Another good read is: http://www.fenwick.com/VC_Terms.htm. It covers nice things like liquidation preferences, rachet clauses and other things that will make your head spin!

paul• 19 years ago

That's a good page. The link is broken though (YC news picked up the period). Here it is again: http://www.fenwick.com/VC_Terms.htm

zkinion• 19 years ago

Very nice blog posting. Its amazing how such a low percent can equal that amount of money.

nickb• 19 years ago

This is a great lesson. A small piece of something big is worth less than a large piece of nothing!

Now, what are the odds that there is gonna be another IPO this decade so that 0.1% of the pre-IPO stock ends up being worth $100mm+? And what are the odds that you'll be the part of it? :)

Paul Buchheit: Equity math for startups (sometimes 0.1% equals $138 million)

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