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Harshita

Startup Enthusiast • 9m

Guys, let's suppose- That 5 teens are working on a service based startup( like a agency,or something like this,etc.) which is not registered or anything! Now, when they come on dividing shares, so should they divide in 5 parts Or in 6 parts ( Diffe

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Sajin

 • 

Foundation • 9m

The question is not clear, I believe you have a misunderstanding about the concept. The simple answer is 5. Share holders are 5 humans who separately holds 5 pieces of the company. Revenue, expense, profits, everything will be by the company, and h

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Harshita

Startup Enthusiast • 9m

yeahh! that's what I wanted to know that basically company ka ek different bank account bnana padega na ...then hi sab manage hoga but then means lekin uska share nhi hoga....then jo company ka valuation hoga vo kaise hoga...I'm so confused frrr!🥹🥹

Sajin

 • 

Foundation • 9m

Valuation doesnt come in bank account, its an estimate. Lets say you have 5 founders with total of 100k Authorised capital (Maximum capital that can be raised) and a paid up capital of 50k (Total capital raised). Ideally the paid up capital will be divided amongst the shareholders according to the share structure, and shares are issued This paid up capital has to be in your bank account, and will be shown in your balance sheet as capital available. If you use 40k capital, for company expenses, balance will be 10k, the number of share per holder will remain same, but value of each share will be reduced to 1/5 But this dont effect valuation. Valuation can be 1M, and you can raise funds or make revenue, both will inc price of the share. This is why investors invest to raise more funds or generate revenue

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