# Lehman's Formula

Lehman's Formula is an algorithm typically used by investment bankers or intermediaries when they make introductions that result in a financial transaction, generally equity and sometimes debt.  It is paid at closing to the investment banker or intermediary.  In most cases, the details are spelled out in an agreement between the parties.

There are 3 basic types; Lehman's, Double Lehman's and Double Percentage Lehman's.

The Lehman's formula is calculated by the following; 5% between \$1 and \$1M, 4% between \$1M and \$2M, 3% between \$2M and \$3M, 2% between \$3M and \$4M and 1% for any funds raised above \$4M.  Each is added in a cumulative manner.

For the Double Lehman's formula, the percentages double to wit; 10% between \$1 and \$1M, 9% between \$1M and \$2M, 8% between \$2M and \$3M, 7% between \$3M and \$4M and 6% between \$4M and \$5M, 5% between \$5M and \$6M, 4% between \$6 and \$7M and 3% for any over \$7M.  Each is added in a cumulative manner.

For the Double Percentage Lehman's formula, it is 10% between \$1 and \$1M, 8% between \$1M and \$2M, 6% between \$2M and \$3M, 4% between \$3M and \$4M and 2% for any funds raised above \$4M.  Each is added in a cumulative manner.