How much of Equity should you give away to Investors

  • As an entrepreneur, your company can be very personal. Turning a hot idea into a full-blown entity takes you on a roller coaster of emotions that only those who experience it can truly understand. It is even more difficult for you to give up control. But difficult as it may be, you need to be ready to capitalize on the investment at the right time. The general rule of thumb for angel/seed phase rounds is that founders should sell 10-20% of the company's equity. These parameters were not drawn out of anywhere, they are based on what the potential equity investor is looking for in terms of profitability.