What your $1M actually returns under each structure — through every round, dollar by dollar.
You told me what you want: put $1M in, take $2–3M back when meaningful liquidity arrives, and let the rest ride for the long-term upside. That's a clear, reasonable goal. The question is which deal structure actually gets you there.
Below are two scenarios. Both assume the same company performance — same product, same team, same fundraising milestones. The only difference is the entry terms. One gives you a higher percentage on paper today. The other gives you more money in your pocket at every stage that matters.
The company was incorporated via Stripe Atlas on May 6, 2026 with 10,000,000 shares authorized: 8,000,000 to the founder (80%) and 2,000,000 reserved as an incentive stock option pool (20%). Your investment purchases newly issued shares. All future dilution — from hiring, from future rounds — hits both of us equally. We issue new shares; nobody's percentage is carved from the other's.
The company issues 3,333,333 new shares to you at $0.30/share. Your shares are yours immediately — no vesting, no conditions. You own 25% of the company from the moment the wire clears.
| Path A · 25% at $4M | Path B · 49% at $2M | |
|---|---|---|
| Entry ownership | 25% | 49% |
| Implied pre-money | $3M | $1.04M |
| Can the company hire a CEO? | Yes — we issue new shares for the CEO grant and both dilute equally. Plenty of room. | Technically yes (equal dilution), but after a 15% CEO grant both of us are in the low 40s. VCs see a founder who barely leads the cap table. |
| Seed round at $20M | Raises normally. You dilute to ~20%. Paper value: $4M. | VCs pass or demand recapitalization. Your 49% gets repriced. |
| Series A at $80M | You hold ~16%. Paper value: $12.8M. You sell $3M in secondary. | If the company reaches this stage at all, your stake has already been crammed down. |
| Your $3M liquidity goal | Achieved at Series A secondary | Requires the company to reach ~$20M+ valuation without VC funding — possible but far harder for a pre-revenue startup without a clean cap table |
| "Let the rest ride" | ~12% of a company on a trajectory to $200M+ | ~15% of a company that couldn't raise its next round |
Your economics don't change. You put in $1M. You get $3M back at the first meaningful liquidity window. You keep roughly 12% riding for the long term. That outcome is identical under both structures.
What changes is whether the company can actually reach that liquidity window. At 25% via stock purchase at $4M, every future investor sees a normal cap table and a founder with room to build a team. At 49% at $2M, every future investor sees a red flag and either passes or forces a restructuring that hurts you more than the clean deal would have.
The $4M valuation is already generous to you as an investor — most angels putting $1M into a pre-revenue AI startup with existing technology and distribution assets would expect a $6–10M post-money. The median AI seed round in 2026 prices at $20M+ post-money. Taking 25% at $4M gets you in at a steep discount to where the market will price the company just months later.
$1M stock purchase at $4M post-money. The company issues 3,333,333 new shares to you at $0.30/share. You own 25% of the company immediately — real equity, not a contract that converts later. As the company raises at $20M, then $80M, your paper value grows to $12.8M. You sell $3M at the Series A secondary, keep the rest riding. Total return potential: 12× or more on a $1M investment.
Same outcome you described. Clean structure that lets the company raise the rounds that create that outcome.
You can get it. This document covers your investment — 25% for $1M, yours from day one. But there's a separate offer to earn significantly more equity by coming on as COO and building this company alongside me.
See the full journey → — how we start as 51/49 partners, how dilution works at every stage, and why your slice gets smaller but worth more at each round.
See the COO grant → — the exact share counts, vesting schedule, and how you earn toward 39% of the fully diluted company over 4 years.