Calculator
Pre-money valuation calculator
Pre-money valuation = post-money valuation - investment. Enter the two figures from your term sheet and see the pre-money value and who owns what after the round.
- Pre-money valuation
- $8,000,000
- Post-money valuation
- $10,000,000
- New investors own
- 20%
- Existing holders keep
- 80%
Arithmetic only. It assumes no option pool increase, SAFE or note conversion in the same round; each of those adds shares and dilutes existing holders further.
The formulas
- Pre-money valuation = post-money valuation - investment
- Post-money valuation = pre-money valuation + investment
- Investor ownership = investment / post-money valuation
- Existing holders' ownership = pre-money valuation / post-money valuation
Questions founders ask
How do you calculate pre-money valuation?
Subtract the amount being invested from the post-money valuation. If a round of $2,000,000 is priced at a $10,000,000 post-money valuation, the pre-money valuation is $8,000,000.
What is the difference between pre-money and post-money valuation?
Pre-money is the value placed on the company immediately before the new money goes in. Post-money is pre-money plus the new investment. The investor's ownership is the investment divided by the post-money valuation.
How much of the company does the investor own?
Investment divided by post-money valuation. $2,000,000 invested at a $10,000,000 post-money buys 20%, and existing holders keep 80% between them.
Why can the real dilution be larger than this calculator shows?
Because other shares can be created in the same round. If the term sheet requires an option pool to be created or enlarged before the round, it is usually counted inside the pre-money, so existing holders absorb it. SAFEs and convertible notes that convert in the round also add shares. This calculator shows the headline split only.
This tells you what a price means, not whether it is a fair one. For that, compare it against the published median pre-money for your stage, or run a full valuation on your own numbers.