During onboarding, founders are asked to provide the details of the virtual shares they plan to create. Note: The process described is only relevant for registration as a founder.
These details include:
The name and ticker of the virtual shares serve as identifiers for the tokens. Both can be freely chosen and may, for instance, include the company name. The ticker represents a shortened version of the name and must consist of three to five characters (e.g., MGT).
The number of virtual shares determines the maximum quantity that can be issued. For a share capital of 25,000 GmbH shares, it is recommended to issue 25,000 virtual shares. However, the exact number always depends on the company’s specific situation and fundraising goals. When deciding, founders should consider questions such as:
How much capital should be raised? How significant should the dilution of existing shares be?
The issuance of virtual shares does not affect the distribution of voting rights, as virtual shares carry none. Economically, however, issuing virtual shares does lead to a dilution of the existing GmbH shares.
To determine the price per virtual share, a company valuation must be established. Since this valuation represents the company’s offer to investors, a formal assessment by an auditor is typically unnecessary. Instead, each offer reflects the company’s own valuation at a specific point in time or corresponds to the valuation that investors are willing to accept. More information on this topic can be found here.
Price per virtual share = company valuation / (fully diluted capitalization including already issued virtual shares)
For example, if a company is valued at €10 million and has 25,000 shares entered in the commercial register, plus 3,000 virtual shares already issued* and no further options, convertible loans, or similar instruments outstanding, the calculated price per virtual share is approximately €357.14.
10,000,000 € / (25,000 + 3,000) = 357.14 €
Note: Virtual shares are only taken into account once they actually exist – that is, from the moment an investment has been completed via Tokenize.it. If no investment has been made yet, this value is 0.
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