Founders Lounge

Hey all! I've heard that a standard rule for new Delaware C-Corps is to authorize 10,000,000 shares when the company is first incorporated. I like this number because it's not too low and not too high, but I'd love to hear your take on how many shares should be issued to founders when the company is incorporated. I've previously heard that it's good to issue 5M of the 10M, and I've also heard it's good to issue 1M of the 10M (so that the company doesn't have to increase the shares too soon). I'd love to hear any insights you have, or any advice you've heard/been given!

There are no hard and fast rules but there are some guidelines you should follow instead of just arbitrarily hsing  a random number like 10 million (which is my experience is much too high). A sensible guideline is to allocate 70 to 80% of your shares to the founders with the balance to go into a pool for key hires and/or early employees. Keep in mind the difference between common and preferred shares also when  you addressing this issue.

Hey all! I've heard that a standard rule for new Delaware C-Corps is to authorize 10,000,000 shares when the company is first incorporated. I like this number because it's not too low and not too high, but I'd love to hear your take on how many shares should be issued to founders when the company is incorporated. I've previously heard that it's good to issue 5M of the 10M, and I've also heard it's good to issue 1M of the 10M (so that the company doesn't have to increase the shares too soon). I'd love to hear any insights you have, or any advice you've heard/been given!