How much equity do I sell with a convertible?

  • Convertible note
  • Cap
  • Percentage-ownership method

  1. Decide how much money you need to achieve your first milestone
  2. Set the convertible investor’s pre-money cap
  3. Determine the investment you need to achieve your second milestone
  4. Forecast the pre-money valuation for your seed round

To simplify, ignore the interest on the convertible.