Dilution per round of financing
Are there startup founders in here who are willing to share some information about their financing rounds? For instance, how much the dilution was, ballpark valuation, board changes etc., and the field in which the startup is operating (ie. e-commerce, biotech...). Just like knowing salary ranges when negotiating your salary, the above can be invaluable for new founders who are looking for funding. Note: I don't expect you to share information that could identify you and result in any sort of problems, but approximative numbers are good enough already. #startup #financing #dilution #valuation
Read The Founders Dilemma
Build a company of experiments, raise capital to pay for experiments. This is the lowest means of dilution and over raises (causing down rounds, or liqudations)
Can you explain what do you mean by “company of experiments” ?
A sustainably successful business is the continuous execution of a conclusion of Immense Customer Value (ICV). You need a hypothesis that is thoroughly vetted, and mission of offerings that deliver ICV. However, your missions must embed continuous feedback loops to ensure that you're quickly reacting to changes in the universe that your ICV thrives in. Think functional programming under test-driven-development practices, but company wide.
Sure, we diluted 6 percent to the accelerator, another 3 percent to a small friends and family round (60k early on) then took 1.2M in convertible notes at $4M cap. That’s all we ever took and sold the company for low eight figures. Made 4.5M as the founder. You should always be creating more value than the money you raise. I have seen many situations where founders have a raised way more than we did (and they got the praise and the accolades) and when the exited (if ever) they got a job essentially at the acquirer... they weren’t able to sell for a number that elevated them to receive compensation over the preferred shares (investors).
Blind shows your company, sharing that information would probably break your contract.