You're in the middle of a funding round. A buyer wants some of your shares, or one of your investors offers to take a few off your hands. For the first time, you could turn paper into real money in the bank.
And your instinct is to say no.
It isn't the price. It's that selling your own shares feels wrong. Take money off now, you think, and your investors will assume you've lost faith, and the board will see one foot already out the door. It feels like letting down the company, the people who backed you, and the plan to build this into something much bigger.
Most founders feel that. And most of the time, it's the wrong call.
This Week in 30 Seconds
- Taking some off is the next move in the game. Going all-in is what builds the company. Taking some profit while you hold what you believe in is how you start thinking like an investor, and good investors respect the shift.
- Size is the whole signal. A small sale reads as prudent; too much, too early, and you confirm the fear. Stay on the right side of that line and it reads as discipline, not doubt.
- Private share sales now move more money than IPOs. In the year to June 2025, founders and backers sold more through private secondary deals than every venture-backed IPO combined. For most, the first cash-out is a private sale, not a listing.
- New tools for concentrated stock. Exchange funds are dropping their entry bar to $100k, and AI reporting tools now show your true concentration on one screen.
From operator to investor
I'll be honest: for years, I'd have told you to hold every share. I've changed my mind, and the reason comes down to a distinction that took me a while to see.
Going all-in is the right instinct when you're building. You bet everything on one company, you ignore the standard advice about diversifying, and that focus is exactly what gives you a shot at a big outcome. Founders who hedge too early rarely build anything that matters.
But building a company and managing the money it creates are two different games, and they reward two different mindsets. The operator goes all-in. The investor does something else. Thinking like an investor means taking some profit off a winning position while you hold the rest. Going all-in and leaving everything there is what a gambler does, even when it feels like conviction.
Taking some money off the table is the first step from one to the other. It isn't a retreat from your company. It's a sign you've started to manage your wealth like an investor rather than riding it like a founder. And good investors notice. Most of them don't read it as doubt at all. They respect a founder who's learning to think this way, because it's the same discipline they apply to their own money.
Investors are more relaxed than you think
The fear that your backers will panic is mostly in your head. Selling a small stake has become an ordinary part of how funding rounds work, and a clean secondary can even help them: an investor who wants more of the company buys your shares in the same round at the price everyone already agreed on.
The numbers show how normal it is. In the year to June 2025, founders and early investors sold around $61bn of shares in private secondary deals, more than every venture-backed company that went public over the same period, combined. Carta counted 396 company tender offers last year, up 62% from the previous year. When SpaceX and OpenAI run multi-billion-dollar deals that let early shareholders cash out while the company stays private, a founder selling a small stake is no longer unusual. It's part of how the market works now.
How much you sell decides everything
None of this means sell freely. The amount is what matters, and it's the one place the old fear is right.
Sell a small part of your holding, and you look like a founder taking sensible money off a position that's grown into most of your net worth. Take a big chunk, or move early, and you look like a founder on the way out. Same decision, opposite message, and the size is what separates them.
There are rough norms here. Selling up to about a tenth of your stake usually reads as prudent. At Series A or B, going much past 5% starts to look like you're not committed; by Series C and later, 10% to 20% can pass without comment. None of that is a rule, and none of it is advice. It's the pattern people describe, and it moves with the company and the round.
Past that point, the concern is fair. Sell too much, and you become less aligned with the investors who came in on the round, and they're entitled to wonder what you know that they don't. There's a second cost as well. Your own shares have, by the company's own track record, been your best-performing asset, and history says most of the long-term gain in any stock comes from a small number of winners. Sell your winner down too far, and you risk giving up the one holding that mattered most. The discipline is to stay on the right side of that line.
What this gives you
Stay on the right side of it, and the case for selling a little is strong, because partial cash does things that never show up on the balance sheet.
It makes some of your wealth real. Knowing that a meaningful sum is in your account, rather than on paper where a bad round could halve it, takes a real pressure off. That security isn't a weakness. For many founders, it's what frees them to keep taking big risks in their business, because their family's safety no longer rests on a single outcome.
It also fixes a strange situation a lot of founders live in: worth tens of millions on paper, still watching the monthly bills. Selling a small stake solves that without taking you out of the game.
And it lets you keep going. Nobody sustains a decade at something this hard without a few real wins along the way. Taking some profit off, sized sensibly, is how you stay in for the long run, rather than burning out or being forced to sell the lot at the worst possible moment.
Playing the long game
So the first sale works when it's small enough to keep you motivated and large enough to change how you sleep. Get the size right and selling some doesn't look like doubt, to your investors or to yourself. It looks like a founder who's in this for the long haul and has started to think like an investor about their own wealth.
The question worth sitting with isn't whether selling any shares betrays the company. It's how much you can sell before confidence starts to look like an exit. The first question has an easy, fearful answer, and it keeps most founders frozen. The second is worth working through calmly, well before a term sheet is put in front of you with a week to decide.
None of this is about cashing out. It's the opposite. You take some off so you can keep backing yourself, for longer and with a clearer head. That only works if you know your number and where you're heading, which is the whole point of winning the game before you try to leave it.
My take on it
For years, my instinct ran the other way. Build the company, hold every share, wait for the one moment that makes all the years worth it. Selling early felt like giving up, like admitting I wasn't sure. A lot of us are built like that, and it's the same drive that makes you a good founder in the first place.
I've come round for the reason I set out above. Building a company and managing the wealth it creates are not the same job. The first pushes you to go all in; the second asks you to think like an investor, holding what you believe in while taking something off along the way, so that a single bad outcome can't undo years of work.
I'm not pretending the exact lines are obvious. How much, how early, in which round, that's specific to each person and each company, and I'm still working it out for myself. But the basic stance has changed for me. The exit isn't a finish line you sprint towards while ignoring everything else. It runs for years, and you're allowed to take something for yourself along the way. The point isn't to cash out. It's to still be standing, and still enjoying it, when the bigger moment comes.
On the Radar
Private share sales now clear more founder wealth than IPOs.
In the year to June 2025, founders and early backers sold about $61bn of shares in private secondary deals, more than the combined proceeds of every venture-backed company that went public in the same period. Carta counted 396 company tender offers last year, up 62% on 2024. If your plan for the first chip is to wait for the IPO, the numbers say otherwise: for most founders, the early cash comes from a private sale, not a listing. When one lands, what matters is the after-tax figure and how long the money is locked up, not the headline price. Read more →
Exchange funds are dropping their entry bar.
An exchange fund lets you put a single stock that's grown a lot into a shared pool and, after a 7-year hold, take out a slice of a mixed basket instead, without triggering a sale on the way in. Cache's new Cobol fund opens this up to accredited investors at a $100k minimum, well under the old thresholds that kept most people out, with a first close on 1 July. For a founder holding one big public stock, it's a way to take a chip off without an immediate tax bill. The catches are real: a long lock-up, higher fees, and tax that's delayed, not cancelled. Worth knowing before someone pitches it to you. Read more →
Consolidated reporting reached the founder tier.
AI-native platforms now pull your entire balance sheet into one place, reading PDF statements and fund documents on their own, across public holdings, private stakes and several custodians. Aleta, named best data provider at the 2026 Family Wealth Report awards, runs more than 100 custodian links across over $100bn in assets. The job that used to need a back-office hire is now something you buy off the shelf. For a lean setup, that's the difference between guessing how concentrated you are and seeing every position, including the one you built, on one screen. Read more →
Set your selling rule before you need it.
Public-company insiders use Rule 10b5-1 plans to lock in a selling schedule while they're clear-headed, then let it run on its own. Jensen Huang's 2025 plan to sell up to 6 million Nvidia shares has read as steady diversification after a huge run-up, not an exit, because he set it in advance, and a broker runs it on schedule. The legal wrapper is for insiders, but the idea travels. The hard part of a first sale is deciding in the heat of the moment, when the stock is tangled up with who you are. A rule set ahead of time, this much, at this price or date, whatever you feel that morning, turns an agonised one-off into a system. Read more →
Founders regret the exit, rarely the price.
Advisers who work with sellers describe a common pattern: real regret within a year of a big sale, and it traces back not to the price but to being unready for what came next, financially and, more often, in the head. If you're holding out on the first chip for a better number, sit with that. Founders rarely regret the price. They regret reaching the finish line without the structure or identity to handle what lies on the other side. Which makes getting ready the thing to build before the sale, not after. Read more →
New on the Site
Last Thursday's piece looked at angel investing for founders: how operators who recently got liquid end up backing other founders, and how to approach it without the rookie mistakes. It connects straight to this week. The first chip off the table raises the question that most founders answer poorly: what to do with the cash once it's finally yours.
Read it: Angel Investing for Founders
This was Capital Signals — weekly briefings on what's reshaping founder strategy on wealth.
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