![]() Let’s assume that they have preferred stock with a 2x liquidation preference.They own 20% of CloseAI, so their ownership stake is also worth $300 million ($1.5 billion * 20%).After receiving their liquidation preference, they would receive $200 million in cash and stock from the acquisition. This means that they receive their original investment amount of $100 million back before any other stakeholders receive payouts. Let’s assume that they have preferred stock with a 1x liquidation preference.They own 20% of CloseAI, so their ownership stake is worth $300 million ($1.5 billion * 20%).If they do so, they would receive $600 million in cash and stock from Guugle. Let’s assume they have fully vested shares and can sell them immediately.They own 40% of CloseAI, so their ownership stake is worth $600 million ($1.5 billion * 40%). ![]() Using these assumptions, here’s a possible way to slice the pie for each stakeholder: The cap table shows the following stakeholders and their respective ownership percentages:ĬloseAI is then acquired by Guugle (A fictional big search company) for $1.5 billion in cash and stock.Let’s assume the following scenario:ĬloseAI has gone through three (virtual) funding rounds in the past 6 months and is now valued at $1 billion. How much Founders of Unicorn Companies Cash In After Exiting? (Waterfall/Liquidity)Ī super simplified example of how CloseAI (A Fictional OpenAI’s competitor) might receive payouts in the event of a successful liquidity event such as an acquisition.
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