Comments on: Angel Investing: Dilution Preventive Measures (Part 3)

By: Angel Investing in 2010: The Ultimate Buyer’s Market | Venture Hype

Angel Investing in 2010: The Ultimate Buyer’s Market | Venture Hype — Fri, 29 Oct 2010 10:49:23 +0000

[...] so will investors’ confidence and appetite for risk. High-quality entrepreneurs and fit (read: capital-efficient) companies are all perked up and ready to expand, providing potentially profitable opportunities [...]

By: University Tech Transfer: Technology Doesn’t Create Company | Venture Hype

University Tech Transfer: Technology Doesn’t Create Company | Venture Hype — Tue, 31 Aug 2010 20:05:36 +0000

[...] of Manitoba Technology Transfer Office, university technology transfer managers are now taking dilution prevention into account. They’re structuring deals in such a way that the university’s final [...]

By: Angel Portfolio Strategy of Brad Feld, Will Herman, Sim Simeonov, Et Al. | Venture Hype

Mon, 30 Aug 2010 23:02:25 +0000

[...] John Huston of Ohio Tech Angels Fund said: “The angels’ best protection against a ‘down round’ is to have adequate dry powder to preclude the need to seek new outside investors.” [...]

By: University Technology Transfer: Smart Managers Do Creative Deals | Venture Hype

Tue, 17 Aug 2010 19:02:11 +0000

[...] example, to prevent dilution, university technology transfer managers are structuring deals in which the university’s final [...]

By: Aluminum Brighteners From Omega Chemical | Aluminum Brightener.info

Aluminum Brighteners From Omega Chemical | Aluminum Brightener.info — Sat, 06 Mar 2010 04:48:17 +0000

[...] Angel Investing: Dilution Preventive Measures (Part 3) | Venture Hype [...]

By: Joey Lo

Joey Lo — Wed, 17 Feb 2010 15:36:53 +0000

Thanks, Basil! Your comment is a great addition to the series. I’m adding your insights to relevant sections in Part 1 and Part 3 (this post).

By: basilpeters

basilpeters — Wed, 17 Feb 2010 03:14:46 +0000

Excellent post, Joey. I agree with Paul Graham that dilution is normal, in fact it's often a byproduct of success (because nothing sucks up capital like a high growth rate). For me, the real question is whether the dilution is accretive to the share value. In other words, I am happy to suffer a 10% dilution if I believe that dilution will add capital to provide an overall 20% increase in share value. I also believe that angels, and entrepreneurs, would have fewer dilution surprises if companies had good alignment on an exit strategy before the first investment went in http://www.angelblog.net/Why_Every_Company_Shou...