TS initially gets 6% (for $18k, but that's irrelevant). The founders also take the $100k convertible notes at $3M cap and 20% discount.
Say the company closes a round of $1M at $3M pre = $4M post, i.e. the investors get 25%.
For me, it's always easier to think about shares.
Say the initial pool is 1,000,000 shares, split in 940,000 to the founders, and 60,000 to TS.
Pre-money, 1 share costs $3, and the investors get 333,333 shares, that are added to the pool.
TS has 20% discount, that makes the price $2.40. With $100k, TS can buy 41667 shares, that are also added to the pool.
Overall, there are now the following shares: 940,000 to the founders, 101,667 to TS, 333,333 to the investors, so they respectively own 68.36%, 7.39%, 24.24%.
(Note: this may be a simplification, meaning that the investors can possibly work on pre-post to have exactly 25%, which means both the founders and TS will have a little bit less.)
Skipping the details, let me add a few more examples.
- Round of $1M at $4M pre = $5M post, i.e. the investors get 20% => founders 73.25%, TS 7.27%, investors 19.48%.
- Round of $500k at $1.5M pre = $2M post, i.e. the investors get 25% => founders 66.35%, TS 10.12%, investors 23.53%.
In conclusion, $100k for 7-11% equity seems pretty reasonable.
Edit 2: I didn't take into account interests on convertible notes. (If the company raises after 1y and interests are 10%/y, then TS can actually buy shares for $110k, thus 45833 shares.)
TS initially gets 6% (for $18k, but that's irrelevant). The founders also take the $100k convertible notes at $3M cap and 20% discount.
Say the company closes a round of $1M at $3M pre = $4M post, i.e. the investors get 25%.
For me, it's always easier to think about shares. Say the initial pool is 1,000,000 shares, split in 940,000 to the founders, and 60,000 to TS. Pre-money, 1 share costs $3, and the investors get 333,333 shares, that are added to the pool.
TS has 20% discount, that makes the price $2.40. With $100k, TS can buy 41667 shares, that are also added to the pool. Overall, there are now the following shares: 940,000 to the founders, 101,667 to TS, 333,333 to the investors, so they respectively own 68.36%, 7.39%, 24.24%.
(Note: this may be a simplification, meaning that the investors can possibly work on pre-post to have exactly 25%, which means both the founders and TS will have a little bit less.)
Skipping the details, let me add a few more examples.
- Round of $1M at $4M pre = $5M post, i.e. the investors get 20% => founders 73.25%, TS 7.27%, investors 19.48%.
- Round of $500k at $1.5M pre = $2M post, i.e. the investors get 25% => founders 66.35%, TS 10.12%, investors 23.53%.
In conclusion, $100k for 7-11% equity seems pretty reasonable.
Edit: fixed formatting