Memos Index
The EconomicsMARCH 28, 2024

The technical equity mathematics

WH
WorkHouse Editorial

The most common pushback we get from founders is about our 10-15% equity requirement. 'Why would I give up 15% when I can raise from an angel for 10%?' This post breaks down the mathematics of why the 10-15% model is heavily skewed in favor of the founder.

Let us look at the standard Angel Round. You raise ₹25 Lakh – ₹1 Crore. You dilute 10%. But now you have to parse through the operating costs of keeping your startup alive for 18 months. You pay rent. You pay legal fees. You pay cloud server bills before you even launch.

Your initial funding becomes actual runway extremely quickly. And you spent 3 months negotiating term sheets instead of writing code. The 10% equity you gave up seems small, but the hidden costs are massive.

Now look at the WorkHouse protocol. We take 15%. In exchange, we cover everything. The lease on your apartment is paid. The coworking space is paid. Your cloud credits are handled by our enterprise accounts. We handle all compliance and corporate incorporation.

The arbitrary costs that drain founder capital are absorbed entirely by our infrastructure pool. You do not just keep a cleaner cap table; you retain pure focus.

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