Responding to Bogomipz: > Can you walk me through the math. How does one arrive at 1K of Series A preferred from 9K of common stock? How is that being derived?

Responding to Bogomipz: > Can you walk me through the math. How does one arrive at 1K of Series A preferred from 9K of common stock? How is that being derived? I'm not following. At time t=0 (probably at founding and when hiring its first few employees) Company X issued 9,000 shares of common stock. At time t=1 it decides to issue 1,000 shares in a series A offering (most likely to VCs and outside investors). They are separate events. 1000 shares x $1000/share = $1m raised for the company in the series A. > Also what is meant by "post-money" valuation? I'm assuming there is a corresponding "pre-money"? https://en.wikipedia.org/wiki/Pre-money_valuation https://en.wikipedia.org/wiki/Pre-money_valuation In this case, pre-money valuation of Company X = $10m - $1m = $9m > Lastly by "coming out flat" you mean made whole again i.e recouped their initial investment? Thanks. Yes.