# How Many Shares Does 13% Equity Equal

1. Junior Member
Join Date
Aug 2019
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1

## How Many Shares Does 13% Equity Equal

Hello everyone sorry for the noob question,

I'm filing an S-Corp for my startup with a seed investor. Authorizing 10M shares with par value \$0.00001 (4 zeros).

If I'm giving my investor 13% equity in the company so how many shares does that equate to?

Company valuation = \$500k
Seed investment = \$65,000

Thank you for your patience and help
Brian

2. Senior Member
Join Date
Oct 2016
Posts
3,228

## Re: How Many Shares Does 13% Equity Equal

This is a math, not a legal question.

But.

65,000 / 500,000 =0.13

.13 x 10,000,000 = 1,300,000

That is assuming that the 10mil shares have all been issued.

3. Senior Member
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Oct 2014
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7,400

## Re: How Many Shares Does 13% Equity Equal

Quoting Bpark73
Hello everyone sorry for the noob question,

I'm filing an S-Corp for my startup with a seed investor. Authorizing 10M shares with par value \$0.00001 (4 zeros).
The company will have \$10 million authorized shares. (Is there really a need to have so many shares authorized for a very small corporation?) But authorized shares are different from the actual number of shares you issue. It is not uncommon for a company to authorize more shares than it actually issues. The unissued stock is kept by the corporation to issue to new investors later. If your investor is to have a 13% stake in the company now then he or she should be given 13% of the stock the corporation issues. So if you decide to issue 1 million shares then you issue to the investor 1 million x .13= 130,000 shares of stock.

In what state are your forming the corporation? Not all states require a stated par value, and if it's not required it's probably best to simply leave out par value. For stock today par value doesn't have much real purpose except in states which base a tax on par value.

4. Member
Join Date
Jun 2019
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## Re: How Many Shares Does 13% Equity Equal

Quoting Bpark73
Hello everyone sorry for the noob question,

I'm filing an S-Corp for my startup with a seed investor. my ip birthday wishes tneb Authorizing 10M shares with par value \$0.00001 (4 zeros).

If I'm giving my investor 13% equity in the company so how many shares does that equate to?

Company valuation = \$500k
Seed investment = \$65,000

Thank you for your patience and help
Brian
That is assuming that the 10mil shares have all been issued.

5. Senior Member
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Oct 2016
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## Re: How Many Shares Does 13% Equity Equal

Quoting nailiyatsi
That is assuming that the 10mil shares have all been issued.
nailiyatsi has embedded some URLs in the message she quoted.

6. Senior Member
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## Re: How Many Shares Does 13% Equity Equal

Quoting PayrolGuy
nailiyatsi has embedded some URLs in the message she quoted.
That's new. Guess this spammer was playing the long game.

7. Senior Member
Join Date
Oct 2016
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3,228

## Re: How Many Shares Does 13% Equity Equal

Quoting free9man
That's new. Guess this spammer was playing the long game.