One of the dangers of seeking financing too early is that you may give investors more equity than you should.

Question

Quizplus · Accepted Answer

Seeking financing too early may result in giving away more equity than necessary because the company's valuation might not have been properly established yet, and investors may ask for a larger percentage in return for their investment. As the company grows and establishes itself, its valuation may increase, which would have allowed it to sell less equity for the same investment amount.

One of the Dangers of Seeking Financing Too Early Is