Glossary

Dilution

Dilution is a reduction in an existing holder's ownership percentage when additional shares or convertible securities are issued. The holder's economic value does not necessarily change in the same way.

Why it matters to a capital raiser

I show current and potential ownership changes when discussing a financing.

A term can mean something different in a particular deal, so read it with the governing documents. General education only. Not legal, tax or investment advice.