STARTUP EQUITY - Who Gets What and Why? How does it work?

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If you are planning to launch a startup then knowing about equity is a must!
In today's video, I will be breaking down to who you should give equity in your business and how it can be highly beneficial for growth.

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00:00 - Intro
01:22 - Why should you give equity and who should get it?
06:27 - How much equity should you give away?
07:59 - My personal benchmark
09:00 - Industry benchmarks
10:29 - Mechanics of equity

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[whistlingmeerkat]

Thank you, this is really great and super helpful.

[breakinglimits]

hey, you made mention of founders owning about 50% of the equity. in the case where there are maybe 2 or 3 cofounders who started the company, how do you give the shares because now you cant allocate 50% to each founder

[aasthatyagi]

Hey, kindly guide me. I'm starting a company based on retail. Idea was mine, I'll be CEO snd "brain" of the company. But i don't have money to invest. I've hired a guy as COO, he'll invest $13, 250 in my company along with his efforts. I won't give him salary even i won't take salary either. So, my business partner is partially investing and I found an investor, he's willing to invest $30k . My startup is in "pre -seed stage" right now! Now, kindly guide me, how much %ge of shares I should give to my COO who's also my co-founder and investor. But I'm "main" in this company, without me it won't run and I want majority shares as CEO and main founder

[JG-noqr]

Two questions- how do you determine what the actually equity of a small business is? What is the equity based on, the amount of money the business has in its bank account? How do you pay investors based on it? Shares- Can an LLC distribute shares? If not, how do you measure equity. In percentage points?

[mrmatias]

Please Lord Jesus bless this channel, allowing it to reach over One Millions subscribed in less than 2 years.
Allows this man works to be fruitful, in Jesus name, amen.
That is the only thing I could think of after being served by your God's gift. Keep it up brother.

[ChrisOzar]

Does startup equity only work if you plan to sell it eventually? How does it work if you have equity in a company that never sells?

[dialektoseducation]

Thank you for the book recommendation.

[joshfarrington]

Something I've never understood (and am currently seeking an answer for)... while our founders and employees shares are vesting, where do they sit? Who owns/holds them during this time? I assume they are issued and held somewhere while vesting, and that companies aren't just issuing more shares each month? Any help legends?!?

[brunonhandu]

Thanks a for the breakdown, you guys are really helpful 😎

[blain]

So what is the motivation for an employee to remain after fully vested other than to remain and contribute?

[aady]

Thank you for this informative video. One query - what if there is no vesting clause in Equity Agreement or SHA, in that case will 100% shares be considered vested immediately after agreement?

[hackmedia]

so you ask someone to do all the work, then take most of the profit. This system is broken.

[theo.n.e.records]

How does this translate to a nonprofit?

[mraa]

Very well presented . I have no question !
Thanks you .

[_luka_bagdavadze]

What happens to employ 5% when we go to seed round and sell 10% of the company? Do they still have 5% or their equity gets reduced to 4.5%?

[GuyDigital]

I was offered a buyout for an online company I own, cash + ($20, 000 equity of their $2.5M valuation). For the life of me I can’t understand what happens if I pull the trigger on accepting that offer. Does it sit and accumulate value over time if they do well? Can I eventually cash out? Do I receive payments quarterly? Any help would be appreciated.

[suicidequad]

you are taklking about percentages of shares with possible dilution in the future, correct? does that include voting rights?