Question about equity percentages?

**aa2202** · 11-15-2009 06:39 PM

Say you have a business with you partner. You guys decide to give the investor 50% of your company for capital. Now how does this work? Does the two original owners split it 25% each or do they just act as one party with 50%?

**Arob** · 11-15-2009 07:19 PM

The later

but you'll want 51%

**aa2202** · 11-16-2009 02:07 AM

the later?

**Mega B** · 11-16-2009 02:19 AM

You have got to keep 51% to keep control of the business

**GuyC** · 11-16-2009 04:06 AM

Originally Posted by aa2202

Say you have a business with you partner. You guys decide to give the investor 50% of your company for capital. Now how does this work? Does the two original owners split it 25% each or do they just act as one party with 50%?

If you and your partner currently own 50% each of the company and you want to give away 50% total of the company, all that is left is 50% to split between your partner and you. So you have 25%, partner has 25% and the other person has 50%.

Avoid doing this unless the business is going to fail if you don't. You are diluting your stake in the company and giving up control.