But wait - You're leaving out the company's loss of 10% of its equity as part of the investment transaction. A "company" can't lose equity it never owned any t

But wait - You're leaving out the company's loss of 10% of its equity as part of the investment transaction. A "company" can't lose equity it never owned any to begin with. The equity was transferred from one party (usually the founders) to another entity in exchange for cash. After the investment, the company had $1350K of equity left because it sold 10% of itself, and it no longer owned that chunk of equity. This is completely wrong.