What level of dilution should you expect in funding rounds?
When are you getting overly diluted?
Dilution is one of the most misunderstood concepts in startup land. But many employees are afraid to ask for a simple explanation.
Here’s how it works:
What’s Dilution?
Dilution occurs whenever new (more) shares are issued (created). Let's go through some common scenarios and then look at the benchmarks based on company stage:
1/ When the Firm Completes a Fund Raise: This is the most well known scenario.