This is Tech

Founder Equity Dilution by Industry

My firm just published our Spring 2008 Entrepreneurs Report, summarizing trends in the venture-backed technology market over the last several years. Among the statistics is this interesting chart showing the average founder equity dilution in Series A and Series B financings broken down by industry. The dilution numbers on the BioTech industry are up above 90%, meaning that by the end of the second round of financing founders of biotech companies don't own much of the company. The counter to this is that biotech projects require a greater degree of funding, and if you need to raise a lot of money, you aren't going to get it without giving up some equity.