A second issue is the equity or ownership position in the venture that is to be retained by the entrepreneur. Most new venturists would like to hold majority control, although it may not always be possible. It should be apparent that as the venture moves through each phase of financing there can be more capital given up for risk funding. Typically, the entrepreneur finds his or her equity position reduced. Of his own savings. Frank Stronach retains control of Magna International through Class A and Class B equity, where he retains control but the public and management hold the ownership.
For most entrepreneurs the desire to hold control is understandable but often it is the case that others are needed to add to the success. Steven Jobs and Steve Wozniak gave up equity to bring in Markulla to gain his marketing skills. Within three years the venture grew to$100 million in sales. Sam Walton, founder of Wal-Mart, owned 39 percent of the company in 1985 but controlled it because he was the founder and largest share holder. At that time he was the richest man in America.