Principles for designing a company's shareholder structure

Principles for designing a good company shareholder structure It is still talked about in a narrow circle. not widespread But it is very important. Especially for newly founded companies or startups, because if there is no planning or designed well will have an effect on shareholders since the founder and investors who come to invest in each investment round Both in terms of the number of shares held Including returns for investors upon exit. The principles for designing a good shareholder structure should include the following principles:

1.Easy & Simple

2.Understandable

3.Dilution Effect

4. Value Creation

5.Controls

1.Easy & Simple: The design should not be complicated. There are clear principles for calculating stocks. Especially in the case of the founder of the company. It should be based on hard work. or invest money with clear principles that can be explained

2.Understandable From the principle that Easy & Simple will make investors who will become shareholders and understand the proportion of existing shares

3.Dilution Effect is an important matter that must be designed well. It should be a capital increase with a premium, not a cut of shares for sale. This is a very important step so that the number of shares of the founder of the company does not decrease to the point of losing ownership. In general, the founding group of the company should maintain a stake of no less than 40% after every round of fundraising.

4.Value Creation in designing the shareholder structure The value of the shares must be taken into account. To be confident that The value of stocks must continue to increase. This will result in a significant increase in the value of the company. Conforms to the founding principles of the company

5.Controls: Main shareholders must ensure that they still have a voice in controlling the company. This can be done using the principles in points 1-2, which must be able to control various aspects such as ownership, voting rights, and the number of executive committees. and financial control

It can be seen that the design of the shareholder structure is very important. But sometimes it may be neglected. And when the shareholder structure is well designed This will result in the company being able to operate smoothly. Reduce conflict and increase the chance of success as intended

See you again next time. Please take care of your physical and mental health. Thank you.