What is the final ownership stake of the founders

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A VC invests $4 million in a series A investment at a $1 price per share in an early stage company. Two years later, the company is negotiating a series B VC investment for $5 million. Founders and stock option pool have 6.5 million shares. The potential VC investor in the series B financing estimates that, without accounting for any anti-dilution clauses, they would be willing to invest at 82 cents a share. Assuming that the series A contract includes a full-ratchet anti-dilution clause, and that the series B VC will account for such a clause by adjusting their own price lower to keep their ownership stake fixed, what is the final price per share at which the series B financing will take place? What is the final ownership stake of the founders?

Reference no: EM131566330

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