VC Dilution Calculator
Enter your current ownership, the round size, pre-money valuation and option pool expansion to see what percentage of the company you will hold after the round closes.
Reviewed by the CalcCafe editorial team · Last updated 18 July 2026 · How we test our tools
Example
Suppose you own 40% of a startup that raises a $3,000,000 round at a $12,000,000 pre-money valuation with a new 10% option pool. Post-money = 12M + 3M = $15,000,000, so the new investors take 3 ÷ 15 = 20%. With the pool taking another 10%, existing holders keep 70% of the company, and your stake becomes 40% × 0.70 = 28% — 12 points of dilution in one round. Without the pool expansion you would have kept 32%; the pool alone cost you 4 points.
How it works
Post-money valuation = pre-money + round size. The new investors’ stake = round size ÷ post-money × 100. This tool assumes the new option pool is created pre-money (the standard VC term sheet ask), meaning the pool and the new investors together carve their percentages out of the existing holders: your new ownership = current ownership × (100 − investor% − pool%) ÷ 100, applied pro-rata across all pre-round holders. Dilution = old percentage minus new percentage, in points. The model treats blanks as 0, guards division by zero, and floors the retained fraction at 0. It intentionally ignores converting SAFEs and notes, pro-rata participation, and share-level rounding — each of which shifts a real cap table.
Good to know
The option pool shuffle is the least understood term in a first venture term sheet. VCs almost always require the new pool to be created pre-money — before their investment prices — so the pool dilutes only the existing holders, not the incoming investors. Economically, a $12M pre-money with a mandated 10% post-money pool is really a lower effective pre-money for the founders: in the example above the pool costs you 4 extra points versus a post-money pool. The standard counter is to negotiate the pool size against the actual hiring plan for the next 18-24 months rather than accepting a round 10-15% default — every unneeded pool point is a point of founder equity handed over for free.
Dilution compounds across rounds, and the compounding is multiplicative. A founder keeping 70% of their stake per round holds 0.7³ ≈ 34% of the original position after three rounds: 40% at incorporation becomes roughly 28% after seed, 20% after Series A, and 14% after Series B on typical terms — before any secondary sales or additional pools. That is not automatically bad: 14% of a company worth 50x more beats 40% of one that never raised. The discipline is to model the full path — most founders of venture-backed companies at IPO hold between 10% and 20% combined — and to make each round’s dilution buy demonstrable progress in valuation per share, not just headline valuation.
Pro-rata rights are how earlier investors escape this arithmetic. A pro-rata right lets an existing investor buy enough of each new round to maintain their percentage — a 10% holder can take 10% of the new round and stay at 10%. When earlier investors exercise pro-rata, the new lead’s allocation shrinks or the round grows, and the non-participating holders (usually founders and employees) absorb correspondingly more of the dilution. Whether an investor consistently exercises pro-rata is also a strong signal other investors read closely in later rounds.
Anti-dilution provisions only bite in down rounds, but then they bite founders twice. Preferred investors typically hold weighted-average anti-dilution: if a later round prices below their round, their conversion price ratchets down by a formula blending the old price, new price and shares issued — broad-based weighted average is the founder-friendlier standard variant. Full-ratchet protection, rarer but not extinct in tough markets, reprices the entire earlier round at the new lower price regardless of size, and can transfer brutal amounts of equity from common holders. If a term sheet contains full-ratchet language, price it as the equity giveaway it is and negotiate hard.
Frequently asked questions
Why does the option pool dilute founders and not the new investors?
Because VC term sheets require the pool to be created pre-money — before the new investment prices. The pool percentage therefore comes out of existing holders, effectively lowering the founders' real pre-money valuation. Negotiate the pool size against your actual 18-24 month hiring plan instead of accepting a default 10-15%.
How much dilution is normal per venture round?
New investors typically take 15-25% per priced round, plus a 5-15% option pool refresh in earlier rounds — so existing holders commonly keep 65-80% of their prior stake each round. Compounded over seed through Series B, a founder often ends up with roughly a third of their starting percentage.
What are pro-rata rights and how do they affect my dilution?
A pro-rata right lets an existing investor invest enough in the new round to keep their percentage. When earlier investors exercise it, non-participating holders — usually founders and employees — absorb relatively more of the round's dilution, since the participating investor's stake does not shrink.
Is my data uploaded anywhere?
No — this calculator runs entirely in your browser. Your ownership and valuation figures never leave your device, and the page keeps working offline once loaded. It is completely free with no sign-up.
People also ask
What is the difference between pre-money and post-money valuation?
Pre-money is what the company is valued at before the new money comes in; post-money = pre-money + investment. The investors' ownership equals their investment divided by the post-money — $3M into a $12M pre-money is $3M of a $15M post-money, or 20%.
What is weighted-average anti-dilution protection?
A clause that lowers preferred investors' conversion price if a later round prices below theirs, using a formula weighted by how much cheap stock is issued. Broad-based weighted average is the standard, founder-friendlier form; full-ratchet — repricing the whole earlier round at the new low price — is far more punitive to common holders.
How much equity do founders typically have at IPO?
After compounding dilution from seed through late-stage rounds and option pools, founder teams of venture-backed companies commonly hold 10-20% combined at IPO. Keeping more usually means raising fewer or smaller rounds, or growing efficiently enough to command high valuations each time.
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Sources & references
These tools follow our methodology and provide educational estimates only — verify important figures with a qualified professional.