How ownership dilution is decided?

While raising money from investors how 'ownership dilution' is decided?

2 Answer(s)


Dilution is based supply and demand. There is no direct science for this, its more an art.

Dilution depends on the following factors -
1) Company's financial performance
2) Market size
3) Competition
4) Customer Satisfaction
5) Team etc

The better the above 5 characteristics the lower the company has to dilute. If these 5 characteristics are not very interesting then company will have to dilute more.


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