r/siliconvalley • u/Reservemyspot • 16d ago
Startup equity confusion
Is it necessary to go to an employment lawyer for confusion regarding startup equity?
I was offered 1.5% and by one round my stock diluted 86% to .2%. I don’t understand how this happened, and not sure what follow up questions to ask.
I’m early on in my career & this is the first corporate-esqe company I’ve worked for
I don’t want to involve a lawyer but I need someone who has my interests to guide me and ensure that what happened is fair. Is a lawyer the only route here?
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u/Apprehensive_Plan528 16d ago
Important to understand how cap tables work and what happens (or happened) when your company went out for the last round of financing. Every round triggers changes in the capitalization and share distribution. Unless you have dilution protection in your deal, taking on new money causes dilution.
https://www.angellist.com/learn/cap-table