So I am planning on buying shares of an early startup which is doing an internal round funding and I got the opportunity to invest. This is my first time investing and would want to know what are things to consider and what I should ask the startup for before I hand in a cheque.

1. Existing valuation of the company
2. Methodology adopted to reach the valuation
3. Nature of equity on offer (Sweat etc)
4. Probable exit plans
5. Proportionality between additional shares that may get pumped into the system, taking total number of shares increase, and proportional increase/decrease in your percentage.

Hope above helps!!

Answered 7 years ago

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