# How much percentage of company will I own? [closed]

I am going to start my tech company (private limited). The authorized capital of the company is \$100K with 100k common shares (\$1 per common share). I issued 10k common shares for me. Later, I got an investor who wants to pay \$50k for 10% of the company's shares.

How many shares should I issue for this? And what percentage ownership will I have after this? Should I increase the authorized capital?

• Are you having trouble calculating 10% of 100k? Or 100%-10%?
– JohnFx
Commented Nov 22, 2021 at 19:13
• If this isn't a homework question, hire an accountant + lawyer who should be responsive to questions like this. Taking on an investor for 50k without professional guidance is a recipe for disaster. Commented Nov 22, 2021 at 20:43
• @JohnFx I want to be clear whether the 10% will be counted on common share or on issued share on me ?
– John
Commented Nov 22, 2021 at 22:26
• That depends on whatever you decide to do.
– JohnFx
Commented Nov 28, 2021 at 4:15

## 1 Answer

If the partner gets 10K shares for \$50K and the founder has 10K shares then the partner is accounted as 50% of \$150K. Percentage of un-issued shares is no problem to the partner because the partner now has 50% voting.

If the founder gets an additional issue of 10K shares and the partner gets 10K shares for \$50K then the founder is accounted 66.67% of \$150K while the partner is accounted 33.33% of \$150K.

If the founder gets an additional issue of 80K shares and the partner gets 10K shares for \$50k then the founder is accounted 90% of \$150K while the partner is accounted 10% of \$150K. Of course the business might have a business practice which produces upcoming and ongoing revenue and have value beyond liquid book value.

The founder could sell a percentage of their current holding but in that case the founder gets the money while the company doesn't get any additional funding.

I suppose, or obviously, it would be a breach of fiduciary duty to issue new shares for inadequate value when not negotiated with partners or shareholders.