Assume you started working on your own business 4 months back and just launched the product. Now you want to raise Rs.50 lakhs (5 million) from some investors. How much equity should you expect to dil



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the answer is 15%, why not, 5% or 30%?

2 Answer(s)


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As explained in the module, around 15% is what most investors typically take. 5% is too little for so much risk and 30% is too much for an amount of 50 lakhs.

Remember that these are rough numbers and there is no exact science behind this.

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The math behind this is as follows.
If you raise 5 million for 15% then the valuation of your company is 33.3 million (5million/.15)

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