What's the logic in assigning the type of equity shares ( options ?! / standard shares, preferred..) to founders, investors, co-founders, cto...?


Type of shares are generally split into two: common/ordinary (depending on the jurisdiction) and preferred. The former are granted to founders and employees (most commonly as options with a right to purchase common/ordinary shares). The latter are generally issued to investors and include special rights such as liquidation preference, anti-dilution protection, etc. Preferred shares reflect the fact that the holder (investor) has paid a premium in consideration for issuance of such shares. Don't forget to consult with a lawyer.

Answered 11 years ago

Typically for founders and employees you assign options that vest (an option to buy a common share at a given price).

The basics of venture math is described by Brad Feld:


The preferences that an investor can put in deal structures change. See

You should talk to a lawyer that has experience with share holder agreements, employee stock option plans and the tax implications of the different decisions based on your jurisdiction.

Answered 11 years ago

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