Early Stage Funding · Equity distribution

How much equity to give on raising capital for Early Stage Enterprise?

Marcela MBA Brand Management, Marketing Strategy, Market Entry, New Product Development

November 30th, 2015

We are an Early stage with products placed in the market (consumer packaged goods). 
Looking to raising funds around 150K USD with 15-20% of the Company being sold to new shareholders (currently a unique shareholder).

1. What is a typical deal structure? Precisely about equity distribution: ‘slicing the pie’ how much equity based on capital investment amount?..

2. What will be a usual Early adoption discount scheme on equity, offered to potential investors? 

3. Exit strategies for the investors and lock-up period (2- 3 years min) - some local investors already willing to contribute with capital but need 2x or 2.5x on their investment in 3 years. How the specific exit strategies requested by investors will reflect into the final equity agreement? 

Need to mention that new shareholders will not have a seat in the board and no decision power after investing.


A-level teams with B-level ideas succeed. B-level teams with A-level ideas fail. This course provides a comprehensive roadmap for building a standout team, teaching everything from hiring to structure, compensation, and culture.