Venture Capitals Effort vs Entrepreneurs Effort

Level of Equity ownership will have an impact on the Venture Capitalist and Entrepreneur

• An Increase in ownership of equity by venture capitalist will reduce the effort level of entrepreneur but it will increase the effort level of entrepreneur. 
• An Increase in ownership of equity by entrepreneur will increase the effort level of entrepreneur but it will reduce the effort level of venture capitalist. 

Optimal level of ownership is the best for venture capitalist and entrepreneur 

The ideal level of ownership is optimal level of ownership which is 50% for both parties. In real life it is much more complicated than this because there are more than one owners of equity in the team of entrepreneur which they can come to disagreement anytime and they can also reduce their level of effort if as an individual does not have enough ownership.