: Incorporating, issuing stock and evaluating it Imagine that I incorporate my company in some place like Delaware and issue 10,000,000 in shares and start to offer these share for each. To attract investors, I offer 3

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No.

Mark-to-market valuation relies on using a competitive market of public traders to determine the share price --- from free-market trading among independent traders who are not also insiders.

Any professional valuation would see through the promotional nature of the share offer. It is pretty obvious that the purchaser of a share could not turn around and sell their share for , unless the 'free hosting' that is worth most of the follows it... and that's more of hybrid of stock and bond than pure stock. It is also pretty obvious that selling a few shares for does not mean one could sell 10,000,000 shares for , because of the well known decreasing marginal value effect from economics.

While this question seems hypothetical, as a practical matter offering to sell share of unregistered securities in a startup for to the general public, is likely to run afoul of state or federal securities laws -- irregardless of the honesty of the business or any included promotional offers.

See www.sec.gov/info/smallbus/qasbsec.htm for more information about the SEC regulations for raising capital for small businesses.