What is pre-money and post-money valuation?

Pre-money valuation is the company's value before receiving investment. Post-money = pre-money + investment amount. A $2M investment at a $8M pre-money valuation gives a $10M post-money valuation, meaning the investor owns 20% ($2M/$10M).

How much dilution is normal per funding round?

Typical dilution: Angel/Pre-seed: 5–15%. Seed round: 15–25%. Series A: 15–25%. Series B: 10–20%. Founders typically retain 10–30% by the time a company goes public after multiple rounds.

What is an option pool and why does it dilute founders?

An option pool (ESOP) is a reserved block of shares for employee equity compensation. Investors typically require a 10–20% option pool before a round is closed — this is created from existing shares, primarily diluting founders before investor money comes in.

How do I minimize dilution?

Raise at higher valuations (less dilution per dollar), raise only what you need, grow fast to justify higher valuations at each subsequent round, and negotiate option pool shuffles (some of the pool can come from post-money).

What is a liquidation preference and how does it affect founders?

A 1× non-participating liquidation preference means investors receive their investment back first in an exit, before founders share proceeds. In a $5M exit with $3M invested, investors take $3M and founders split $2M. Above 2×, investors can take most of the exit value even with minority ownership.

Is my data sent to a server?

No. All dilution calculations run locally in your browser. Your valuation figures, investment amounts, and ownership percentages are never transmitted to any server or stored anywhere.

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Free Equity Dilution Calculator — Startup Founder Ownership After Funding

Equity dilution is the reduction in existing shareholders' ownership percentage when new shares are issued. This calculator models founder dilution through funding rounds — showing pre-money and post-money ownership for founders, investors, and option pool, across up to 4 rounds from pre-seed to Series B.

Free — No SignupRuns in BrowserData Never Uploaded

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Calculate founder ownership percentage after funding rounds and option pool creation.

Founder dilution across multiple funding rounds
Pre-money and post-money ownership percentages
Option pool modelling
Founder stake value at each round
Cap-table ownership breakdown
Client-side only — nothing is uploaded

Features

Everything you need in one Startup Equity Dilution Calculator

Multi-round dilution

Model pre-seed through Series B in one place and watch founder ownership step down round by round.

Pre-money & post-money

Each round uses the pre-money valuation and investment to derive the investor's stake from the post-money figure.

Option pool included

Add an option pool per round — created from the pre-money, so founders absorb the dilution, exactly as investors structure it.

Founder stake value

Translates founder ownership into a dollar value at the latest post-money valuation, so percentage and worth are both visible.

How It Works

How to use Startup Equity Dilution Calculator

Enter starting ownership

Input founder shares and any existing shareholder percentages before any funding.

Add funding rounds

For each round, enter investment amount, pre-money valuation, and option pool percentage if applicable.

See dilution table

The calculator shows ownership percentage for each party after each round, and cumulative dilution.

Format Comparison

Typical dilution by funding round

Round	Typical investor stake	Typical new pool
Pre-seed	10–20%	0–10%
Seed	15–25%	10–15%
Series A	20–25%	5–10%
Series B	15–20%	3–5%

Troubleshooting

How to fix common syntax errors

Most “invalid JSON” failures come from a small set of mistakes. Paste the failing JSON above, click Validate, and the tool points you at the exact line and column.

Calculating investor ownership from pre-money instead of post-money$2M investment at $8M pre-money → investor owns 2/8 = 25%

Investor ownership = investment / post-money valuation. Post-money = $8M + $2M = $10M. Investor owns 2/10 = 20%, not 25%.

Forgetting option pool is created before the round closesFounders model 10% ESOP as issued after investment

The option pool shuffle happens before investment: 10% ESOP is carved from existing shares first, diluting founders, then investor money comes in. Founders dilute twice.

Treating convertible notes as equity before conversionSAFE from pre-seed included as 15% equity ownership in current cap table

SAFEs and convertible notes convert to equity at the next priced round. Model them as a separate calculation — their dilution effect depends on conversion terms (cap, discount).

Using shares outstanding instead of fully diluted share countFounder owns 4M of 8M shares = 50% — but options not counted

Fully diluted includes all issued shares + outstanding options + SAFE/note conversions. True ownership percentage uses the fully diluted share count as the denominator.

Not modeling pro-rata rights for existing investorsNew round modelled without existing investor maintaining percentage

Pro-rata rights allow existing investors to participate in new rounds to maintain their ownership percentage. This increases the round size and dilutes founders less per dollar raised.

Comparing percentage ownership to economic value without liquidation prefsFounder with 20% expects 20% of exit value

1× non-participating liquidation preferences mean investors are paid first up to their investment. In a low-exit scenario, founders receive less than their percentage suggests. Model the waterfall.

FAQ

Frequently asked questions

Equity dilution reduces existing shareholders' ownership percentage when new shares are issued. A founder who owns 100% of a company that issues 25% to an investor now owns 75% — their percentage dropped (diluted) even though the number of their shares did not change.

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References

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