Dilution Calculator
Compute new investor stake, option pool, and your post-round ownership.
Written by Golam Rabbani, Founder & Lead Engineer
How to use this dilution calculator
- Enter total shares outstanding before the round and the shares you personally hold.
- Enter the round's pre-money valuation and the new investment amount.
- Optionally enter the target post-money option pool % (set 0 to skip pool expansion).
- Press Calculate dilution to see your ownership before and after, plus the new investor and pool shares.
- Use Copy to share the result or Reset to model a different scenario.
About this dilution calculator
Dilution is the reduction in your ownership percentage when a company issues new shares — usually in a priced funding round or option-pool top-up. The mechanics: price per share = pre-money valuation ÷ existing shares; new investor shares = investment ÷ price per share; option pool is sized so pool ÷ total-post = target pool %. Your post-round percentage is your unchanged share count divided by the new total share count.
Worked example. You own 4,000,000 of 10,000,000 outstanding shares (40%). The round is $20M pre-money + $5M investment, with a 10% post-money option pool. Price per share = $20M ÷ 10M = $2.00. New investor shares = $5M ÷ $2.00 = 2,500,000. Pool sized so pool ÷ total = 10%: pool ≈ 1,388,889 shares. Total post = 10M + 2.5M + 1.39M ≈ 13.89M shares. Your stake = 4M ÷ 13.89M = 28.8%. Dilution = 40% − 28.8% = 11.2 percentage points. The new investors get $5M ÷ $25M post-money = 20.0% (which matches their 2.5M ÷ 13.89M share count).
Negotiating a smaller pool top-up or a higher pre-money is the lever that reduces founder dilution most.
FAQ
- What does "pre-money option pool" do to my dilution?
- A pre-money pool is created or topped up before the round closes, so the new pool dilutes only existing holders (you), not the incoming investors. Investors typically require this structure — it is the single biggest source of "hidden" dilution in seed rounds.
- How is the new investor percentage calculated?
- New investor % = investment ÷ post-money valuation = investment ÷ (pre-money + investment). This is identical to new investor shares ÷ total shares after issuance because price per share is constant within the round.
- Can I model multiple rounds?
- Use this tool one round at a time, then feed the post-round share count and your remaining shares into the next iteration. For multi-round modeling, the Cap Table Generator is purpose-built.
- What is a "no-pool" round?
- A round where the option pool is not topped up. Set the option pool % to 0 in the tool. This is rare in priced rounds but common in bridge financings or insider rounds.
- How can I reduce dilution?
- Three levers: (1) negotiate a higher pre-money valuation, (2) reduce the option-pool top-up, or (3) take less money. Each one trades off against fundraising flexibility — be intentional.
- Is my financial data saved?
- No. All inputs are computed in your browser and discarded on page close.