Hacker News new | ask | show | jobs
by rahimnathwani 45 days ago
If you work at a tech startup then you probably hope your company raises an additional round of funding, i.e. you hope you get diluted.
1 comments
LtdJorge 45 days ago
Isn’t that done with already existing shares (from the founders)? Then it wouldn’t be dilution.
link
rahimnathwani 45 days ago
No.

The main purpose of a funding round is for the company to sell shares and receive cash (e.g. to spend on marketing), not for founders to sell shares and receive cash (e.g. to spend on Ferraris).

(Sometimes, at the same time as a funding round, founders may also sell some existing shares to the new investors.)

link