This work was a collaboration with my former student, Charlotte Sagan MBA/MPH, who just graduated!

When founders launch a company, they start with 100% ownership. But as they raise capital and build out their teams, that stake inevitably shrinks. By the time a company reaches the public markets, founders often hold just a sliver of the pie, or may no longer be involved at all.

To better understand the cap table and ownership by the time a company reaches an IPO, we analyzed the SEC IPO registration filings (also known as the “S-1 form”) across 34 digital health companies (excluding SPACs) that have filed or gone public since 2019. Our goal was to uncover how much equity founders typically retain by IPO, and what dynamics shape those outcomes.

The short answer: there’s no such thing as a “typical” cap table. Founder ownership varied widely, shaped by early funding dynamics, private equity involvement, and whether the founder stayed with the company through the IPO. In this piece, we’ll share what stood out.

Note: The founder ownership data in this article is based on publicly filed S-1 documents and our related calculations. Because each company discloses share ownership differently—and some use dual-class structures or include stock options—the numbers reflect economic ownership (not voting control) and may involve calculated assumptions. While we’ve made every effort to ensure accuracy and consistency across all IPOs, variations in reporting mean these figures should be interpreted as directional rather than exact. See our Methods section at the end for more details.

Startups are messy

One of our biggest takeaways after digging into the S-1s of these companies is that startups are messy. Each one has its own story shaped by years of decisions—who they hired, how they raised money, which terms they agreed to, who left, who stayed, and who got squeezed out.

Over the (median) nine years from founding to IPO, equity gets divided and re-divided across founders, employees, and investors, all with different rights and expectations. By the time the company goes public, the ownership structure is never straightforward, and no two cap tables look the same.

A number of founders had left their companies before they went public. Some departures were planned, others less so. And the level of acknowledgment at IPO varied—some founders were still celebrated, others were entirely absent from public materials.

For example, Weave Communications co-founder and original CEO Brandon Rodman was replaced in 2020, stepped down from the board in 2021, and was gone before the IPO later that year. His co-founder Clint Berry also left that year, and there was no mention of him in the S-1. Rodman later reflected publicly on the experience, saying, “Then, almost overnight, I was no longer running Weave. I didn’t understand. No one did. It didn’t make sense. But it happened.”

This is not uncommon. In about 1 in 6 of the companies, none of the founders were involved at IPO (as an employee, board member, or shareholder listed in the S-1). In about a quarter of the companies, at least one co-founder had left. And in 57% of the cases, the entire founding team was still involved in some way.

Founders who are not involved in the IPO often go on to build something new. Rodman, for example, is now working in consumer fintech. Gina Bartasi, who founded Progyny and left two years before the IPO, later started Kindbody—another fertility company. Andrew DeMichele, one of the cofounders of Omada Health, went on to found mental health company Bruin Health.

It’s in their DNA—founders are going to keep founding.

Founder ownership at IPO is highly variable

There is no standard founder stake when a company goes public. But not surprisingly, the more co-founders involved, the less equity each person gets.

First, we looked at co-founders as a group. 18% of the companies had a solo founder, 38% had two founders, 26% had three founders, and just 3% had four or more. Five of the companies had no “founder” as they were PE-orchestrated companies.

Among the companies in this dataset:

Co-founder ownership (as a group) ranged from nothing to 47.2%.
Average equity amongst founders at IPO was 12.4%.
Median equity amongst founders at IPO was 9.2%.

Then, we looked at the co-founders individually. There were 64 individual founders across these 34 companies.

Here’s what we learned:

Average equity per individual was 5.7%.
Median equity per individual was 2.0%.
42.2% of founders had NO equity as per the S-1, and 68.8% had under 5%.

It’s also worth noting that co-founders rarely own the same amount of equity. This doesn’t necessarily mean founders didn’t start with relatively equal shares. Some founders may stay on through IPO and retain meaningful equity, while others sell shares early on the secondary market or leave the company altogether.

Startup pay is notoriously low, so it’s understandable when a co-founder wants early liquidity. In 2018, for example, Peloton’s founders—John Foley, Thomas Cortese, and Hisao Kushi—sold back over 2.3 million shares before the IPO, cashing out $39.2 million. By IPO, their ownership stakes were minimal. Similarly, Thorn Healthtech co-founder Al Czap cashed in equity, taking away $1.3 million at the company’s Series E financing, while co-founder Paul Jacobson kept 12.2% of ownership in the company through IPO.

In rare exceptions where co-founders owned a similar stake at IPO, they seemed to have strong, life-long connections:

GoHealth: Co-founders Clint Jones and Brandon Cruz were college roommates who previously started a business together.
Amwell: Co-founders Roy Schoenberg and Ido Schoenberg are brothers.
SmileDirect Club: Co-founders Alex Fenkell and Jordan Katzman are childhood friends who had previously founded a business together. Jordan’s father, David Katzman, was an investor in the company and served as CEO. Jordan’s uncle Steve Katzman served as COO.
HealthCatalyst: While co-founders Steve Barlow and Thomas Burton met working at Intermountain Healthcare, Tom’s dad Dr. David Burton was the CEO until Tom’s brother Dan Burton took over in 2011.

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Individual founders owning 20%+ at IPO is rare

Significant dilution is the norm as companies move toward IPO. Only five people in our analysis retained over 20% at the time of going public.

Oftentimes, it was because the founder had access to their own capital:

The founders of Smile Direct Club benefited from early backing by Camelot Venture Group, run by the father of co-founder Jordan Katzman. By IPO, Jordan owned 24.7%, while his father held 31.2%. The COO was also a family member. Smile Direct Club has since filed for bankruptcy.
At Oscar Health, co-founder Josh Kushner was also the lead investor through his VC firm Thrive Capital. This helped the founding team maintain both ownership and control. Josh controlled 19.6%, and his co-founder Mario Schlosser controlled 4.3% at IPO.
Accolade co-founder J. Michael Cline, who previously founded Fandango and Accumen, funded Accolade through his own venture firm, Accretive LLC. He owned 26.9% at IPO. Accolade was recently acquired by Transcarent for ~$621M.

But there are other cases where founders held onto the company through sheer strategic growth:

Eric Lefkofsky of Tempus: 41.5%
Jeffrey Tangney of Doximity: 32%
Daniel Perez and Gabriel Mecklenburg of Hinge Health (filed): 24.7%

Private equity is often in the driver’s seat

Private equity firms played a major role in more than a few of the IPOs we looked at. In fact, 26% of the companies were taken public by private equity firms.

These PE firms take a few strategies:

Roll-ups: Some of the companies were created through PE-backed roll-ups, combining multiple businesses into a new entity. Agilon Health was formed by Clayton Dubilier & Rice through the purchase of two businesses in 2016. Signify Health was formed by New Mountain Capital in 2017 by merging and recapitalizing CenseoHealth and Advance Health. Waystar was created in 2017 through the merger of Navicure and ZirMed, orchestrated and funded by Bain Capital Private Equity.
Full buyout before IPO: TPG acquired Lifestance in 2020 and took it public the following year. Claritev (formerly MultiPlan) changed PE hands several times (Carlyle in 2006, then BC Partners and Silver Lake in 2010, then Starr Investment and Partners Group in 2014, and finally Hellman & Friedman in 2016) before going public in 2020.
Gradual majority ownership: PE firms often build up stakes over time. Silverlake owned 37% of GoodRx, and General Atlantic owned 29% of Oak Street Health by the time they went public.

In all but one of these cases, the founder was no longer involved by IPO—and often wasn’t even mentioned in the S-1. The one exception is LifeStance Health. Founder and CEO Michael Lester owned 6.2% of the company at IPO, and stayed on for one year post-IPO.

That said, the CEOs who run these private equity-orchestrated companies are experienced executives with lucrative compensation packages. Just take a look at Agiliti, which was acquired by THL (Thomas H. Lee Partners) in 2019 and taken public soon after. The CEO owned 2.5% at IPO:

Conclusion

Founders start companies with a vision, and also with full ownership and control. But control is a currency that gets traded over time: for capital, for talent, for growth. By the time a company hits the public markets, the cap table tells a story of all those trades.

What we found in analyzing 34 digital health IPOs is that no two stories are the same. Some founders hold on to sizable stakes. Others walk away with nothing. Some stay at the helm through IPO and beyond; others are long gone by the time the company rings the bell. Private equity can accelerate growth—or edge founders out entirely.

And while success isn’t guaranteed whether a founder stays or not, one thing’s clear: most founders don’t stay still. They start again. Because building is in their DNA. Even if the equity fades, the instinct to create doesn’t.

Methods

While based on publicly available data from S-1 and S-1/A filings with the SEC, it’s important to note that these calculations involve many estimates and interpretations.

Variability in S-1 disclosures: Although SEC filings follow general formatting standards, each company presents its ownership data differently. Some are highly transparent with clear tables and definitions, while others require deeper cross-referencing of footnotes, exhibits, or pre/post-offering share counts. There is no consistent, universal way economic interest is shared in S-1s.
Rounded and estimated figures: Where only partial data was disclosed (e.g., percentages but not full share counts), we reverse-engineered totals based on consistent logic, such as using disclosed share counts and corresponding ownership percentages to infer total shares outstanding.
Dual-class structures: Some companies use dual-class share structures (e.g., Class A and Class B common stock), which separate economic ownership from voting control. This article focuses on economic ownership—the proportion of total outstanding shares beneficially owned by founders—not on voting power.
Up-C structures: Several of the companies used Up-C structures (Deloitte has a good overview of this here). In these cases, we assumed each Class B share is paired 1:1 with one LLC unit, which does represent economic ownership.
Option treatment: Founder share counts sometimes include stock options exercisable within 60 days of the IPO. These are typically factored into SEC definitions of "beneficial ownership" and are included in our analysis unless otherwise specified.
Beneficial ownership attribution: In some filings, founders may be shown as each holding the same block of shares due to shared voting agreements or family trust structures. This can result in apparent double-counting. While our dataset may report each founder’s beneficial ownership as stated in the filing, the actual economic stake may reflect shared ownership of a single equity block. Interpret percentages accordingly.
Assumptions and best effort: Every effort was made to ensure accuracy and consistency across the dataset. However, because of inherent inconsistencies and ambiguities in how companies report share ownership, please consider these figures as best-available estimates rather than precise totals.

How Much Equity Do Founders Have at IPO? We Analyzed 35 Digital Health Companies to Find Out