Understanding your equity dilution as the startup grows



Kirsty Nathoo, CFO at Y Combinator, the World's most successful startup accelerator, talks about the dilution of your shares with successive rounds of funding, and how this should be something you think through before raising any funds.







Task

1. Create a spreadsheet to analyse different seed rounds, with different amounts raised at different valuation caps.

2. See how the conversion of these safes into equity dilutes your shares at later rounds.

3. Make sure that any deal you make are thought out ahead of time as you don't want to dilute your shares so much that you lose motivation, or that you struggle to raise further rounds of funds.



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