Understanding Dilution

WRITTEN BY: SUBRATA SAHA
STARTUP LEGAL STUFF

Subrata Saha is a lawyer based in Texas. He has put together a pretty comprehensive overview of dilution, how it works, and how to think about it as a founder. In this guide, you’ll find the following topics covered:

• The meaning of dilution.

• Anti-dilution protection

• Different kinds of anti-dilution protection

• Price-based anti-dilution background

• Mechanics of price-based anti-dilution protection

• Different price-based anti-dilution methods

• Price-based anti-dilution formulas

• Price-based anti-dilution examples

• Exceptions and carve-outs

• Accompanying anti-dilution provisions with pay-to-play provisions

• Takeaways and summary of what is dilution

• Tips for founders regarding dilution

Read the full guide here.

Originally Published:
2017, What is Dilution?, Startup Legal Stuff: Simplifying the Law - Subrata Saha