π Pre-Money vs Post-Money Calculator
What the round is worth, and what it costs you.
Post-money valuation
Estimates for planning only, not financial advice.
Pre-money valuation is what the company is worth before new money arrives; post-money is pre-money plus the investment. Raise $2 million at an $8 million pre-money valuation and the post-money is $10 million, with investors owning 20 percent. The distinction matters because price per share, and therefore your dilution, is set on the pre-money number.
How to Use This Calculator
Enter the agreed pre-money valuation and the round's investment amount. Add the founder share count before the round to get price per share, the new shares issued, and post-round ownership percentages. Option pools and convertibles complicate the real world; this covers the core math.
Enter pre-money valuation and investment. Post-money is their sum; investor ownership is investment divided by post-money.
Add pre-round shares to compute price per share and the new shares the round creates.
Read founder dilution. For how dilution compounds across rounds, our compound interest calculator shows the math of repeated percentages.
The Pre and Post Money Formula
Price per share comes from pre-money, not post-money: investors buy in at the company's value before their own cash inflates it. That is why a higher pre-money means less dilution for the same check. Negotiations are really about this number, whatever the headline valuation sounds like.
Worked Example
Founders hold 1,000,000 shares and agree an $8 million pre-money valuation for a $2 million raise. Post-money is $10 million. Price per share is $8. The round issues 250,000 new shares ($2M / $8). Investors own 20 percent ($2M / $10M); founders keep 80 percent (1M / 1.25M). The founders traded a fifth of the company for the capital to grow it.
Reading Your Result
Dilution per round of 15 to 25 percent is normal; across seed to Series B, founders often fall from 100 percent to 50 or 60 percent. The option pool shuffle matters: if investors insist the pool comes from pre-money, founders absorb the dilution, not the new money. Negotiate whether the pool is pre or post.
My rule: valuation is vanity, dilution is sanity, and terms are reality. A high valuation with aggressive liquidation preferences can be worse than a lower clean valuation. A 1x non-participating preferred is standard; participating preferred or multiples above 1x quietly rewrite who gets paid first. Read the term sheet's economics, not just the headline number. For the investor's return math on the round, our ROI calculator frames the multiple they need.
Estimates for planning only, not financial advice.
Frequently Asked Questions
What is pre-money valuation?
Pre-money valuation is the agreed value of a company before a financing round's new investment is added. It sets the price per share for the round. If the pre-money is $8M and the round raises $2M, the post-money valuation is $10M.
What is post-money valuation?
Post-money valuation is pre-money plus the investment raised in the round. It represents the company's implied value the moment the round closes, and it determines investor ownership: investment divided by post-money. Post-money is what the headlines quote; pre-money is what founders should negotiate.
How is price per share set in a round?
Divide the pre-money valuation by the pre-round fully diluted share count. New investors buy at that price. A higher pre-money means a higher share price and fewer new shares for the same check, which means less dilution. Option pool shuffle can quietly shift the effective price: clarify whether it is pre- or post-money.
How much do founders get diluted per round?
Typically 15 to 25 percent per priced round. Seed through Series B often takes founders from 100 percent to roughly 50 to 60 percent ownership. The option pool, usually 10 to 20 percent, adds further dilution depending on whether it is carved from pre or post money.
What is the option pool shuffle?
Investors often require an option pool for future hires to be created before the round, out of pre-money, so founders bear its dilution. Founders prefer it post-money, sharing the dilution with new investors. It is one of the most negotiated points in a term sheet.
Do SAFEs and convertible notes affect this math?
Yes. Outstanding SAFEs and notes convert into the priced round, usually at a discount or valuation cap, adding shares beyond the headline round. Compute the round on a fully diluted basis including all convertibles, or the dilution will surprise you.
What is the difference between pre-money and post-money ownership?
Investor ownership equals investment divided by post-money. At $8M pre and $2M invested, that is $2M / $10M = 20 percent. Quoting ownership on pre-money would wrongly give 25 percent; the denominator must include the new money. At $8M pre with $2M in, founders keep 80 percent; the math is merciless and worth doing first.
Why does valuation matter more than the check size?
Because valuation sets dilution. A $2M check at $8M pre costs 20 percent; the same check at $4M pre costs 33 percent. Founders should optimize for the valuation and terms, not just the dollars raised. A 1x non-participating preferred is founder-friendly standard; anything harsher deserves a valuation discount.
What terms matter besides valuation?
Liquidation preference (who gets paid first), participation, anti-dilution provisions, board control, and pro-rata rights. A high valuation stapled to harsh terms can leave founders worse off than a lower, cleaner valuation. Convertible notes with valuation caps defer this whole argument until the priced round.
How do down rounds affect dilution?
A down round (lower valuation than the last round) issues more shares per dollar, diluting everyone more, and can trigger anti-dilution adjustments that issue extra shares to earlier investors. It also bruises morale and signals weakness to the market. Pay-to-play provisions punish non-participating investors in down rounds; founders should understand them before signing.