How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • Go back-and-forth until satisfied
    Rate the answer you receive.
Ask Alex J. Your Own Question
Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 4001
Experience:  Solicitors 2 years plus PQE
Type Your Law Question Here...
Alex J. is online now

Equity, london, we have divided shares but I want to know

Customer Question

JA: Where is this? It matters because laws vary by location.
Customer: london
JA: What steps have been taken so far?
Customer: we have divided shares but I want to know more information when a later investor comes on board
JA: Anything else you want the Lawyer to know before I connect you?
Customer: we are a startup
Submitted: 6 months ago.
Category: Law
Expert:  Nicola-mod replied 6 months ago.
I've been working hard to find a Professional to assist you with your question, but sometimes finding the right Professional can take a little longer than expected.
I wonder whether you're ok with continuing to wait for an answer. If you are, please let me know and I will continue my search. If not, feel free to let me know and I will cancel this question for you.
Thank you!
Customer: replied 6 months ago.
Hi Nicola yes l can wait for an answer - thank you
Expert:  Alex J. replied 6 months ago.

Thank you for your question. My name is ***** ***** I am company solicitor - and I can assist you. Can you provide me with any further information? Kind regards AJ

Customer: replied 6 months ago.
I am in business with my friend and we are launching a skincare company. She was the original founder of the company and I joined 6 months in and we have basically started creating it together. We agreed that I own 30% ofthe business and she owns 70%. When we get investors on board that want to receive shares, what are the ways to dilute the shares? I don't want to lose my 30% but if an investor comes on board and gets equity from "her shares", would that money go into her pockets or back to the business? Or is it common practice to both dilute the shares? I just want to be pre-cautious and know the options. Thank you!
Customer: replied 6 months ago.
Also, we are based in the UK and have a Limited Company - Thanks AJ
Expert:  Alex J. replied 6 months ago.

Thank you. My apologies - do you both have the same class of share? Also what type of investor are you looking for? A bank or a private individual or crowd funding for example?

In theory - it would be difficult for the other shareholder to dilute you without you having some control over the situation - with a 30% shareholding you will always have “pre emption” rights. Any investor is likely to want you to dilute below 25% - because you would have total power to block special resolutions -and this may impact an investors view on how the company is managed. Do you have share certificates for your shares - have they been formally issued?

Customer: replied 6 months ago.
Hi Alex, would you be able to schedule a call today or tomorrow? I am pretty flexible in time
Customer: replied 6 months ago.
Please let me know I am interested to speak to you