How can I recalculate the value of the initial investment in our company?

Guest Writer
Entrepreneur, Business Planner and Angel Investor
min read
Opinions expressed by Entrepreneur contributors are their own.
Wow. For others reading this, what a great example of why so many experts, including me, urge people to get it in writing.

You need to go over this with an attorney. It might all be defined in the corporate papers (I hope). It's unusual for those additional investments to take place without definition of how much equity they represented. Normally even smaller companies tie ownership to shares, and then define how many shares when there is a new investment. It's hard to believe that information isn't written down in minutes somewhere. Are you a corporation? LLC? It's likely that these shares had to be defined for tax purposes. Maybe you're just not asking the right person.

If there has been proper recording of percentage of ownership for each investment, then your share is a matter or calculating the math of shares and dilution.

I'm also surprised you weren't forced to sign some things, as these other investments happened, because normally existing investors get to decide, with each new investment, whether or not they get to keep up with the investment to avoid dilution.

But I'm not an attorney, so I can't give you legal advice.

Tim

More from Entrepreneur

Get heaping discounts to books you love delivered straight to your inbox. We’ll feature a different book each week and share exclusive deals you won’t find anywhere else.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Create your business plan in half the time with twice the impact using Entrepreneur's BIZ PLANNING PLUS powered by LivePlan. Try risk free for 60 days.

Latest on Entrepreneur