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Round dilution calculator
Enter the pre-money valuation, the amount raised, any option pool top-up and the founders' current stake. The calculator returns the post-money valuation, the new investor percentage and what the founders own after the round closes.
Company rounds
Founders own after the round
52.5%
- New investors own
- 20%
- Post-money valuation
- $15,000,000
- Effective pre-money after the pool
- $11,250,000
- Founder dilution (percentage points)
- 17.5
Planning estimate from the figures you enter. Not investment, tax or legal advice.
How it is calculated
- Post-money valuation = pre-money valuation + amount raised.
- New investor stake = amount raised / post-money valuation.
- Existing holders keep 100% minus the new investor stake minus the pool top-up.
- Founders after = founders before x the share existing holders keep.
- Effective pre-money = pre-money minus the pool top-up valued at the post-money price.
Worked example: A $3 million round at $12 million pre-money
| Post-money valuation | $15,000,000 |
| New investors own | 20% |
| Pool top-up | 5% of post-money |
| Existing holders keep | 75% |
| Founders: 70% before | 52.5% after |
| Effective pre-money | $11,250,000 |
Why the pool sits in the pre-money
Most term sheets ask the company to create or enlarge the option pool before the new money arrives. The new options then dilute only the existing holders, not the incoming investor, which lowers the effective pre-money valuation.
Negotiate the pool from a hiring plan: list the roles you will fill before the next round and what each grant costs. A pool sized to the plan is easier to defend than a round number.
What the data room should show
Investors check this maths against the pro forma cap table in the room. Put the current cap table, the pro forma after the round and the option ledger in the same folder, with the same share counts.
If convertible notes or SAFEs convert in the round, add the conversion workbook. Their discount and cap often move founder ownership more than the pool does.
Typical ranges
Seed and Series A rounds often sell 15% to 25% of the company. Pool top-ups of 5% to 15% of post-money are common. These are broad ranges, not rules; each round is priced on its own terms.
Mistakes to avoid
- Leaving SAFEs and notes out of the pro forma, then finding the founders own less than planned.
- Agreeing a pool size without a hiring plan behind it.
- Comparing headline pre-money valuations without adjusting for the pool.
- Sharing a cap table in the room that does not match the share ledger.
Questions and answers
Does the option pool dilute the new investor?
Not when it is created before the round, which is the usual term. The top-up is then carried by the existing holders only.
What is the difference between dilution in points and in percent?
Points are the simple drop (70% to 52.5% is 17.5 points). In relative terms the founders kept 75% of what they held.
Where should the cap table go in the data room?
In the corporate or capitalization folder near the top of the index, next to the share ledger, the option plan and the pro forma. See the raise checklist.