http://bestbusinesslive.info/what-percentage-of-a-business-do-you-typically-have-to-give-to-an-investor-funding-a-business-idea/50/ Business Info for the Experts Sun, 28 Feb 2010 23:24:34 +0000 hourly 1 http://wordpress.org/?v=3.2.1 http://bestbusinesslive.info/what-percentage-of-a-business-do-you-typically-have-to-give-to-an-investor-funding-a-business-idea/50/comment-page-1/#comment-83 SDD Tue, 02 Sep 2008 00:54:33 +0000 http://bestbusinesslive.info/what-percentage-of-a-business-do-you-typically-have-to-give-to-an-investor-funding-a-business-idea/50/#comment-83 In a TYPICAL venture deal (yours is not, of course, since it's so small), it would be pretty common to give seed round investors 20-30% of the equity. Another way to look at it is that private equity investors expect to get 15x-20x their investment if the company is very successful. If your company (assuming success) might have a market cap of $1MM, then 20x on a $5M investment would only be 10%. It's usually a negotiating process in any case. In a TYPICAL venture deal (yours is not, of course, since it’s so small), it would be pretty common to give seed round investors 20-30% of the equity. Another way to look at it is that private equity investors expect to get 15x-20x their investment if the company is very successful. If your company (assuming success) might have a market cap of $1MM, then 20x on a $5M investment would only be 10%. It’s usually a negotiating process in any case.

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