How to issue shares to NEW INVESTORS?

The Startup Club by Slidebean · Intermediate ·🚀 Entrepreneurship & Startups ·2y ago

Key Takeaways

The video explains how companies issue shares to new investors, specifically focusing on the process of creating new shares for investors, and how this affects the ownership structure of the company, particularly for C Corps in the US.

Full Transcript

how do you give shares to investors the company creates new shares for every new investor the company reserves some shares to give to them the founders sell part of their shares to investors or D the percentage ownership is redistributed every time if Walt and Jesse get together to build I don't know a math lab and they want to split it equally they'll each get let's say 10 shares wal's shares will never change hands or be sold to investors nor will jesses if they ever decide to bring an investor to their startup what'll happen is the will create new shares for them Walt will still have 10 shares Jesse will still have 10 shares and the new investors will get new shares in their names so the answer to this question is a for most companies around the world issuing new shares that's how things are going to work especially for C Corps in the US which is the standard business type answer D would be correct for llc's but llc's are not a great practical type of business entity for multiple rounds of funding because you have to redistribute shares all the time and it's it's a very complicated legal mess
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Playlist

Uploads from The Startup Club by Slidebean · The Startup Club by Slidebean · 18 of 60

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2 Startup shares aren’t pies: they’re bricks. #equity #shares #slidebean #startupclub #startups
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3 A Startup Valuation is like betting odds 🎰
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4 Giving Stock Options ≠ Giving Shares ☝️
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5 The PAINFUL Road from Pitch Deck to Funding
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6 Every SaaS Acronym Explained
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7 How would I run a startup (If I had to start over)
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8 NEVER make an MBA your co-founder
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9 Raising Venture Capital Takes LONGER Than You Think
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10 The Startup Club by Slidebean Live Stream
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11 The 4 Biggest RED FLAGS on a Pitch Deck
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12 MBA's are NOT great Startup Founders
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13 NEVER outsource your Minimum Viable Product
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14 The Ultimate Pitch Deck Guide - 2026
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15 Avoid this MISTAKE founders commonly make
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16 How to Raise Startup Funding: EVERYTHING You Need to Know
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17 Can your Startup raise money?
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How to issue shares to NEW INVESTORS?
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19 Why Software Patents Are Useless
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20 Startup Financial Modeling Explained (+ FREE Template)
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21 You NEED this spreadsheet for your Startup
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22 What NOBODY Tells You About Selling a Startup
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23 I Did 3 Startup Accelerators (So You Don't Have To)
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24 Top 6 Startups that Apple Killed
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25 The Pitch Deck that Shaped All Pitch Decks
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26 LLC vs INC: a guide for startups
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27 How to write a Killer Elevator Pitch - 2025
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28 How to Scale a Startup Team
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29 The ONE thing Investors look for in Startups
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30 The RIGHT Way to Calculate your Market Size (TAM/SAM/SOM)
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31 Beware of Convertible Notes
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32 Idea to Exit (and the Most Common Mistakes Founders Make)
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33 How Much Equity Are Founders Keeping
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34 Startup Budgeting (And What Most Founders Get Wrong)
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35 Solo Founder? There’s a catch...
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36 This Slide shows investors you get it
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37 Investors Don’t Trust Your Projections
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38 More Ideas ≠ Better GTM
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39 You’re Budgeting Your Startup Wrong
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40 The Hidden Danger of Churn
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41 Why Startup Founders Lose Equity But Not Control
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42 Why Startups Die Between Rounds
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43 From “drop out” to “finish school first”? 🎓➡️🚀
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44 How to Get Startup Funding: What Convinces An Investor?
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45 Why Most Startups Fail to Get Investors
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46 The Weird (but Exciting) State of Startup Funding
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47 The startup playbook is dead and AI killed it
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48 How to Calculate Customer Lifetime Value the RIGHT Way
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49 Being a newcomer isn’t a weakness
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50 Culture isn’t soft. It’s expensive when it’s wrong
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51 Great startups don’t start with ideas
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52 Why unprofitable startups are popular again
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53 Obsessing over political headlines is quietly hurting your business
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54 Runway doesn’t save startups. Alignment does.
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55 The hidden discipline behind a great pitch deck
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56 [Live Webinar] Startup Funding Rounds in the AI Era
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57 The right way to approach investors #fundraising #startups #vc #entrepreneur
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58 Stop forecasting revenue like this
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59 [Live Webinar] How to Pitch an AI Startup to Investors
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60 How to Value your Startup (and keep your Equity)
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The video teaches how companies issue shares to new investors, and how this process works for different types of business entities, such as C Corps and LLCs. It also highlights the importance of choosing the right business entity for multiple rounds of funding. By understanding how share issuance works, entrepreneurs can better navigate the process of securing funding and managing their company's ownership structure.

Key Takeaways
  1. Determine the type of business entity
  2. Understand the process of issuing new shares
  3. Calculate the impact on ownership structure
  4. Choose a suitable business entity for funding rounds
  5. Prepare an equity distribution plan
💡 Creating new shares for investors is the most common method of issuing shares, especially for C Corps in the US, as it avoids the complexity of redistributing existing shares.

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