In my previous blog on Dilution of Ownership, I explored how startup funding rounds impact equity. Now, let’s dive into a hot-button, highly-debated, and dramatically misunderstood matter of policy - taxing unrealized capital gains (or the wealth tax). Could this policy drastically alter the startup landscape? Would there be a tangible impact on founders, investors, and the innovation ecosystem as a whole?
There is a lot of confusion surrounding the dilution of ownership, especially in the tech startup space. What does this mean in layman’s terms? Who does it impact? And most importantly, why you should care if you plan to work for a startup. This is a topic I have discussed with many new (and even some seasoned) engineers over the past few years. I recently had this very discussion with a senior engineer (and close friend) who is leaving big enterprise for startup land. He suggested I write a blog in the plain speak that I used with him. Little does he know (until now) that this is as deep as I go on this topic!
