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Dilution calculator

Most of them divide your stake by the post-money and stop. This one converts your SAFEs, pre-money or post, carves the option pool on the side it actually sits on, and then tells you which of the three took the most.

Your numbers

Your share of the cap table as it stands, before any of this.
What the round values the company at before the new money lands.
The new money. Any unit you like, as long as it matches the others.
Leave it empty if the round does not create or top up a pool.
Pre-money is the standard ask: it dilutes the people already here and leaves the incoming investor at exactly their percentage. Post-money is shared by everyone.

SAFEs and notes converting at this round

Post-money is the YC standard since 2018 and its percentage is fixed, so a second one dilutes you rather than the first. Pre-money notes dilute each other.

No notes yet.

Your share

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Add what you own and the round

What to ask before you sign

Dilution is negotiated rather than interrogated, so this list runs the other way from the one on our runway page: these are the questions worth putting to the other side of the table. Fill the calculator in and the ones drawn from your own term sheet join them, marked.

  1. What is the option pool actually for: which roles, over what period?

    A pool is sized from a hiring plan, and a plan can be discussed. A round number cannot, which is why the number usually arrives without one attached.

  2. Does this include everything that converts, or are there notes outside it?

    A forgotten note is the most common reason a founder's real post-round number differs from the one they walked in with. Convertible notes, advisor equity and side letters all land at the same moment.

  3. What does your number look like after the round after this one, on the same terms?

    Dilution compounds, and the decision that matters is rarely this round in isolation. Running it twice is the cheapest planning anybody does.

  4. Who has pro-rata rights, and what do they cost you if everyone exercises them?

    Existing holders taking their pro-rata in the next round is dilution you have already agreed to and have not yet counted.

The four things these calculators get wrong

Post-money SAFEs do not dilute each other

Y Combinator replaced the pre-money SAFE with the post-money SAFE in 2018, and the two behave completely differently. A post-money note's percentage is fixed at its cap (500,000 on a 5,000,000 cap is ten percent, full stop), so a second note does not shrink the first one. It shrinks you. Two ten-percent notes are twenty percent between them and the founders absorb all of it.

A pre-money note prices off the valuation over the existing share base, so the notes dilute each other as well as the founders. The same two notes leave you holding more. Most free calculators model one of these and do not say which, which makes them silently wrong for half the people using them.

A cap and a discount are not added together

A note carrying both converts at whichever gives the holder more shares, that is, at the lower effective valuation. A twenty percent discount on an eight million pre-money is an effective six-point-four million; against a five million cap, the cap wins. Averaging the two, or applying whichever is listed first, quietly shorts somebody.

The pool shuffle

This is the one that costs founders the most and surprises them the most. An option pool created pre-money is carved out of the pre-money valuation, which means it dilutes everyone who was already there and leaves the incoming investor at exactly the percentage they negotiated. A pool created post-money is shared by everybody, investor included.

Term sheets almost always ask for pre-money, and the request usually arrives without the word "pre-money" being said out loud. On a large pool and a small round, the pool can cost you more points than the money does, which is why this page leads with where the dilution went rather than with what you have left.

Points, not percent

Going from sixty percent to forty-eight is a fall of twelve points. It is also a twenty percent fall. Both are true and they are different numbers, and mixing them up is how a conversation about dilution goes wrong quickly.

What this does not do

It works entirely in percentages and never asks for a share count, because a founder holding SAFEs usually has no formal cap table yet. That makes it a thinking tool and not a document: the output is not something to hand a lawyer. Real pre-money SAFE conversion with several notes is circular, and the convention used here (each note prices off the pre-money valuation over the existing base) is the standard simplification. It is right to a fraction of a point. Liquidation preferences, anti-dilution ratchets and secondary sales are not modelled at all.

Terms on this page

SAFE
Simple Agreement for Future Equity. Money now, shares later, at the next priced round.
Valuation cap
The highest valuation at which a note converts, however well the round goes. It is the early investor's reward for being early.
Discount
A percentage off the round's price. Where a note has both, the holder takes whichever buys more shares.
Pre-money / post-money SAFE
Whether the note's percentage is measured before or after the other notes convert. Post-money has been the YC standard since 2018 and is the one whose percentage is fixed.
The pool shuffle
Creating the new option pool out of the pre-money valuation, so it dilutes existing holders and not the incoming investor.
Points
The arithmetic difference between two percentages. Sixty to forty-eight is twelve points.

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