How Funding Rounds Work
More than simply understanding the terminology and what each round entails, you'll also need to know which rounds are specific to your situation, and how to navigate each one effectively. Below you can see the goals by financing cycle.
The valuations below really apply if you are a Saas operation and you are based on the West Coast or
East Coast in the US. It is still helpful as a frame of reference if you are outside these regions or
segment but it will be approapriate to conduct further research.
Typically you don‘t want to dilute the equity of the company by more than 20 to 25% per financing round. Use this as a rule of thumb and the table below to guide you on the ownership that each stakeholder should have by stage.
The equity ranges below typically work for any startup that is at a Series A level or Post -Series A. For startups pre-Series A the numbers should be increased depending on the milestones achieved around team and product.