💼 Pre and Post Money Valuation Calculator
Calculate startup valuation before and after investment
Amount of investment being made
Percentage of company given to investors
How to Use This Calculator
Enter Investment Amount
Input the amount of money being invested in the company (e.g., $1,000,000).
Enter Equity Percentage
Input the percentage of the company being given to investors in exchange for the investment (e.g., 20% for a $1M investment).
Calculate
Click calculate to see the pre-money valuation (company value before investment) and post-money valuation (company value after investment).
Review Results
Use the valuations to understand dilution, negotiate terms, and evaluate investment offers.
Formula
Post-Money Valuation:
Post-Money Valuation = Investment Amount / (Equity % / 100)
Pre-Money Valuation:
Pre-Money Valuation = Post-Money Valuation - Investment Amount
Example: Seed Round
Investment: $1,000,000, Equity: 20%
Post-Money Valuation: $1,000,000 / (20% / 100) = $1,000,000 / 0.20 = $5,000,000
Pre-Money Valuation: $5,000,000 - $1,000,000 = $4,000,000
Investors get 20% for $1M, company valued at $4M before, $5M after
About Pre and Post Money Valuation Calculator
The Pre and Post Money Valuation Calculator helps startups and investors calculate company valuations before and after investment rounds. Pre-money valuation is the company's value before receiving investment, while post-money valuation includes the investment amount. This essential fundraising tool helps understand equity dilution, negotiate investment terms, and evaluate funding offers.
When to Use This Calculator
- Fundraising: Calculate valuations for investment rounds
- Investment Negotiation: Understand valuation implications of investment terms
- Equity Dilution: Calculate how investment affects ownership percentages
- Investment Analysis: Evaluate investment offers and terms
- Term Sheet Review: Understand valuation implications in term sheets
- Investor Communication: Explain valuation to investors and stakeholders
Why Use Our Calculator?
- ✅ Quick Calculation: Instantly calculate both pre and post money valuations
- ✅ Clear Results: Shows both valuations and ownership breakdown
- ✅ Simple Input: Easy-to-use calculator with just investment and equity percentage
- ✅ Dilution Analysis: Shows ownership percentages before and after
- ✅ Free Tool: No cost for essential fundraising analysis
Common Applications
- Startup Fundraising: Calculate valuations for seed, Series A, B, C rounds
- Angel Investing: Evaluate investment terms and valuations
- Venture Capital: Analyze VC investment rounds and valuations
- Equity Negotiations: Understand valuation in equity negotiations
Tips for Best Results
- Accurate Terms: Use actual investment amount and equity percentage from term sheet
- Multiple Rounds: Calculate each round separately, then track cumulative dilution
- Consider Options Pool: Factor in employee stock options pool if applicable
- Compare Offers: Compare valuations across different investment offers
- Understand Dilution: Recognize that each round dilutes existing shareholders
Frequently Asked Questions
What's the difference between pre-money and post-money valuation?
Pre-money valuation is the company's value before receiving investment. Post-money valuation is pre-money plus the investment amount. For example, if pre-money is $4M and investment is $1M, post-money is $5M. Post-money is used to calculate the equity percentage investors receive.
Which valuation is more important?
Both are important but serve different purposes. Pre-money valuation shows the company's value before investment (what founders own). Post-money valuation shows total company value after investment (used to calculate equity percentages). Investors typically focus on post-money, while founders focus on pre-money.
How does this affect equity dilution?
When new investors buy equity, existing shareholders' percentage ownership decreases (dilution). For example, if founders own 100% and give 20% to investors, founders now own 80%. Each subsequent round further dilutes existing shareholders unless they participate in the round.
What's a typical equity percentage for seed rounds?
Typical equity percentages vary: Seed rounds 10-25%, Series A 15-35%, later rounds 5-20%. However, it depends on valuation, investment amount, negotiation, and market conditions. Higher valuations mean less equity for the same investment amount.
Should I negotiate pre-money or post-money?
You can negotiate either, but they're related. If you negotiate pre-money, post-money is automatically calculated. If you negotiate post-money, pre-money is calculated. Many investors prefer to negotiate post-money valuation. Understand both to ensure you're getting fair terms.
How do employee stock options affect valuation?
Employee stock options (ESOP) pool is typically set aside before calculating ownership percentages. For example, if there's a 20% options pool, investors buying 20% actually get 20% of the remaining 80%, effectively 16% of total company. This is important for accurate dilution calculations.