Cap Table Dilution Calculator

Frequently Asked Questions

How does a cap table change after a funding round?

New shares are issued at the round's valuation, diluting all existing shareholders proportionally. Example: 20% round at $10M post-money issues 25% new shares (20%/(1-20%)). Existing 60% founder ownership becomes 48%. Option pool is usually expanded pre-money, diluting founders further.

What's typical founder dilution per round?

Seed: 15-25% dilution. Series A: 20-30%. Series B: 15-25%. Series C+: 10-20%. After 4 rounds, founders typically own 15-25% of original 100%. Plus option pool refreshes (10-15% each round) and any down rounds. Plan for major dilution by Series C.

Should I issue common or preferred stock?

Founders/employees get common. Investors get preferred (with liquidation preferences, anti-dilution, board rights). Standard preferred in 2025: 1x non-participating preference, weighted-average anti-dilution, optional conversion to common. Avoid 2x+ preferences and full ratchet (founder-unfriendly).

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This calculator provides estimates for informational purposes only. Business results vary by industry, market conditions, and execution. Not a substitute for professional business consulting, accounting, or legal advice. Consult qualified professionals before making business decisions.

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How This Calculator Works

This tool models exactly how much ownership you give up in a priced funding round. Enter founder shares, any existing investor shares, the current option-pool percentage, the round size, the pre-money valuation, and an optional post-money pool top-up. It computes price per share, the new investor stake, and a full pre- and post-money cap table down to the percentage point, including the founder dilution caused by the pool top-up.

Method

Pre-round fully diluted shares = (founders + existing investors) ÷ (1 − existing pool %). Price per share = pre-money valuation ÷ pre-round shares, and new investor shares = round size ÷ price per share. Post-money valuation = pre-money + raise. Any pool top-up is created from the pre-money, so its shares dilute founders only; dilution = founder pre % − founder post %.

Worked Example

8,000,000 founder shares, a 10% existing pool, $5,000,000 raised at a $20,000,000 pre-money. Pre-round total = 8,000,000 ÷ 0.90 ≈ 8,888,889 shares, so price per share = 20,000,000 ÷ 8,888,889 ≈ $2.25. New investors get 5,000,000 ÷ 2.25 ≈ 2,222,222 shares. Post-money = $25,000,000, and the new investors hold roughly 5,000,000 ÷ 25,000,000 = 20% of the company.

Common Mistakes

Forgetting the "option pool shuffle" - a pre-money top-up dilutes founders 100%, costing 5–10 extra points.

Tracking common shares only instead of fully diluted ownership.

Confusing pre-money and post-money - investor % = raise ÷ post-money.

Ignoring how dilution compounds: keeping 75% per round leaves 75%⁴ ≈ 32% after four rounds.

Tips & FAQ

What is typical round dilution? Seed 15–25%, Series A 20–25%, Series B 15–20%, and Series C+ roughly 10–15%.

How do I protect ownership? Negotiate the pool from post-money, right-size it, and raise only enough for 18–24 months plus a milestone.

What is anti-dilution? Broad-based weighted average is standard and triggers in down rounds; avoid full-ratchet terms.

Cap Table Dilution Calculator

Frequently Asked Questions

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