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by wkneepkens
4492 days ago
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It is right, example: US$100 "company", with one investor owning 20% (US$20)
New round of US$50 and the investor uses pro-rata right of 20% . He takes US$50 * 0.2 = US$10 out of the round. Now owns US$30 worth of equity in the US$150 valued company = 20% Obviously valuations, various investors, various rounds, convertibles, etc. can complicate matters. Lastly an investor could also only take part of his 20% right and would then get partially diluted. |
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