### Up Round: 1 on 3, 3on 10

```VCIC Math Help Deck
•2
•3
•4
•5
Negotiated
1
Inv = \$1M
3
Shares \$1
Pre = \$1M
2 Post = \$2M
1M
VC
1M
Up Round:
1on1, 2on3
5
4
Shares
•1
Series A
Negotiate pre-money valuation and
investment amount
Pre + investment = post-money valuation
Choose share price (\$1)
Calculate number of shares assigned
Owned/total shares = % ownership
Ownership
VC: 1M/2M = 50%
Founders: 1M/2M = 50%
Founder
2M Shares
2
Up Round:
1on1, 2on3
1
4
Inv = \$1M
\$1
Pre = \$1M
Post = \$2M
VC
1M
1.3M
\$1.50
VC
3
Pre = \$3M
2M
These two set
the price
Series A
3÷2=\$1.50
1M VC
1M Founder
Shares
1M
Negotiated
Inv = \$2M
Shares
•4
•5
Negotiated
•1
•2
•3
Series B
Negotiate pre-money and investment
Pre + invest. = post-money valuation
Calculate new share price
(pre-money B divided by A total shares)
Calculate number of shares assigned
Owned/total shares = % ownership
Founder
2M Shares
3
2 Post = \$5M
B Pre \$3M
2M Shares
Multiplier: 1.5X
5
3.3M Shares
Ownership
VC: 2.3M/3.3M = 70%
Founders: 1M/3.3M = 30%
3
•2
•3
•4
•5
Negotiated
1
2M
Inv = \$2M
VC
3
Pre = \$4M Shares \$1
2 Post = \$6M
4M
Up Round:
2on4, 12on12
4
Shares
•1
Series A
Negotiate pre-money valuation and
investment amount
Pre + investment = post-money valuation
Choose share price (\$1)
Calculate number of shares assigned
Owned/total shares = % ownership
Founder
5
Ownership
VC: 2M/6M = 33%
Founders: 4M/6M = 67%
6M Shares
4
Up Round:
2on4, 12on12
1
Inv = \$2M
Pre = \$4M
Post = \$6M
VC
\$1
4M
4
Inv = \$12M
3
Pre = \$12M
2 Post = \$24M
B Pre \$12M
6M Shares
Multiplier: 2X
VC
3
Founder
6M Shares
6M
\$2
5
These two set
the price
12÷6=\$2
6M
Shares
2M
Negotiated
•4
•5
Shares
•1
•2
•3
Series B
Negotiate pre-money and investment
Pre + invest. = post-money valuation
Calculate new share price
(pre-money B divided by A total shares)
Calculate number of shares assigned
Owned/total shares = % ownership
Series A
2M VC
4M Founder
12M Shares
Ownership
VC: 8M/12M = 67%
Founders: 4M/12M = 33%
5
•2
•3
•4
•5
Negotiated
1
Inv = \$1M
3
Shares \$1
Pre = \$1M
2 Post = \$2M
1M
VC
1M
Down Round:
1on1, 1on1.5
5
4
Shares
•1
Series A
Negotiate pre-money valuation and
investment amount
Pre + investment = post-money valuation
Choose share price (\$1)
Calculate number of shares assigned
Owned/total shares = % ownership
Ownership
VC: 1M/2M = 50%
Founders: 1M/2M = 50%
Founder
2M Shares
6
Down Round:
1on1, 2on1.5
1
4
\$1
Pre = \$1M
Post = \$2M
VC
1M
Inv = \$2M
2.7M
VC
3
Pre = \$1.5M
Founder
2M Shares
\$0.75
2 Post = \$3.5M
3 B Pre \$1.5M
÷ 2M Shares
Multiplier: .75X
These two set
the price
1.5÷2=.75
2M
Shares
1M
Inv = \$1M
Negotiated
•4
•5
Shares
•1
•2
•3
Series B
Negotiate pre-money and investment
Pre + invest. = post-money valuation
Calculate new share price
(pre-money B divided by A total shares)
Calculate number of shares assigned
Owned/total shares = % ownership
1M VC
1M Founder
4.7M Shares
Ownership
VC: 3.7M/4.7M = 79%
Founders: 1M/4.7M = 21%
7
Practice
•
•
•
•
•
1 on 3, 3 on 10
3 on 3, 5 on 8
2 on 1, 3 on 6, 10 on 15
1 on 1, 4 on 2
3 on 5, 5 on 5
8
1 on 3, 3 on 10
1.
2.
3.
4.
\$1 inv on \$3 pre
\$1 + \$3 = \$4 post
\$1
1M VC, 3M Founder
Total = 4M shares
5. VC 1÷4 = 25%
Founder 3÷4 = 75%
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
1. \$3 inv. on \$10 pre
2. \$3 + \$10 = \$13 post
3. \$10 pre ÷ 4M shares =
\$2.5/share
4. \$3 inv. ÷ \$2.5 = 1.2M
new shares for VC
Total shares 5.2M
5. VC 1.2+1=2.2÷5.2=42%
Founder 3÷5.2=58%
9
3 on 3, 5 on 8
1.
2.
3.
4.
\$3 inv on \$3 pre
\$3 + \$3 = \$6 post
\$1
3M VC, 3M Founder
Total = 6M shares
5. VC 3÷6 = 50%
Founder 3÷6 = 50%
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
1. \$5 inv. on \$8 pre
2. \$5 + \$8 = \$13 post
3. \$8 pre ÷ 6M shares =
\$1.3/share
4. \$5 inv. ÷ \$1.3 = 3.8M
new shares for VC
Total shares 9.8M
5. VC 3.8+3=6.8÷9.8=69%
Founder 3÷9.8=31%
10
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
2 on 1, 3 on 6, 10 on 15
1.
2.
3.
4.
\$2 inv on \$1 pre
\$2 + \$1 = \$3 post
\$1
2M VC, 1M Founder
Total = 3M shares
5. VC 2÷3 = 67%
Founder 1÷3 = 33%
1. \$3 inv. on \$6 pre
2. \$3 + \$6 = \$9 post
3. \$6 pre ÷ 3M shares =
\$2/share
4. \$3 inv. ÷ \$2 = 1.5M new
shares for VC
Total shares 4.5M
5. VC 1.5+2=3.5÷4.5=78%
Founder 1÷4.5=22%
11
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
2 on 1, 3 on 6, 10 on 15
1.
2.
3.
4.
\$10 inv. on \$15 pre
\$10 + \$15 = \$25 post
\$15 pre ÷ 4.5M shares = \$3.33/share
\$10 inv. ÷ \$3.33 = 3M new shares for VC
Total shares 7.5M
5. VC 6.5÷7.5=87%
Founder 1÷7.5=13%
12
3 on 5, 5 on 5
1.
2.
3.
4.
\$3 inv on \$5 pre
\$3 + \$5 = \$8 post
\$1
3M VC, 5M Founder
Total = 8M shares
5. VC 3÷8 = 37.5%
Founder 5÷8 =
62.5%
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
1. \$5 inv. on \$5 pre
2. \$5 + \$5 = \$10 post
3. \$5 pre ÷ 8M shares =
\$0.625/share
4. \$5 inv. ÷ \$.625 = 8M
new shares for VC
Total shares 16M
5. VC 8+3=11÷16=69%
Founder 5÷16=31%
13
1 on 1, 4 on 2
1.
2.
3.
4.
\$1 inv on \$1 pre
\$1 + \$1 = \$2 post
\$1
1M VC, 1M Founder
Total = 2M shares
5. VC 1÷2 = 50%
Founder 1÷2 = 50%
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
1. \$4 inv. on \$2 pre
2. \$4 + \$2 = \$6 post
3. \$2 pre ÷ 2M shares =
\$1/share
4. \$4 inv. ÷ \$1 = 4M new
shares for VC
Total shares 6M
5. VC 4+1=5÷6=83%
Founder 1÷6=17%
14
Practice
• 1 on 2 with 20% option pool
• 2 on 4 with 10% option pool
• 3 on 3 with 5% option pool
1 on 2 w/20% option
1.
2.
3.
4.
5.
6.
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
\$1 inv on \$2 pre
\$1 + \$2 = \$3 post
\$1
1M VC, 2M Founder, Total = 3M shares
VC 1÷3 = 33%, Founder 2÷3 = 67%
Option Pool 20% out of Founder, now 47%
16
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
3 on 3 with 5% option
1.
2.
3.
4.
5.
6.
\$3 inv on \$3 pre
\$3 + \$3 = \$6 post
\$1
3M VC, 3M Founder, Total = 6M shares
VC 3÷6 = 50%, Founder 3÷6 = 50%
Option Pool 5% out of Founder, now 45%
17
1.
2.
3.
4.
5.
Negotiate Pre and Inv
Pre + inv. = post-money
Share price
Calculate shares
% ownership
2 on 4 with 10% option
1.
2.
3.
4.
5.
6.
\$2 inv on \$4 pre
\$2 + \$4 = \$6 post
\$1
2M VC, 4M Founder, Total = 6M shares
VC 2÷6 = 33%, Founder 4÷6 = 67%
Option Pool 10% out of Founder, now 57%
18
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