Equity Dilution Calculator – Calculate Founder Dilution
Free equity dilution calculator. Calculate how fundraising impacts your ownership, share price, pre-money and post-money valuation instantly.
Equity Dilution Calculator – Calculate Founder Dilution
Free equity dilution calculator. Calculate how fundraising impacts your ownership, share price, pre-money and post-money valuation instantly.
Generated: 2/22/2026, 12:35:44 AM | AskSMB.io
Equity Dilution Calculator
Calculate how much equity you'll give up in a fundraising round and understand the impact on your ownership.
Inputs
The total amount of funding you're raising in this round
The percentage of the company investors will own after the investment
The total number of shares that exist before the new investment
Results
Equity Dilution
10.00%
Low dilution - healthy equity preservation
Your Ownership After Dilution
90.00%
Your ownership percentage after the investment
Pre-money Valuation
£900,000.00
Company valuation before the investment
Post-money Valuation
£1,000,000.00
Company valuation after the investment (pre-money + investment)
Implied Share Price
£900.00
The price per share based on the pre-money valuation
New Shares to Issue
111
Number of new shares to be issued to investors
Percentage of Pre-money Valuation Raised
11.11%
Investment amount as a percentage of pre-money valuation
Ownership Breakdown After Investment
Valuation Breakdown
Share Count: Before vs After
Understanding Equity Dilution
Key Concepts
Pre-money Valuation
The valuation of your company before new investment. This is calculated by determining what valuation would result in the investor owning their desired percentage after investing their capital.
Post-money Valuation
The valuation of your company after the new investment. This is simply the pre-money valuation plus the investment amount.
Share Price
The implied price per share is calculated by dividing the pre-money valuation by the number of existing shares.
Dilution Impact
Your dilution percentage equals the percentage of new shares being issued. While your percentage decreases, the total value of your stake may increase if the valuation is fair.
Example Calculation
Let's say you're raising £100,000 for 10% post-money equity, and you currently have 1,000 shares:
- Pre-money valuation: £900,000
- Post-money valuation: £1,000,000
- Implied share price: £900
- New shares to issue: 111 shares
- Your dilution: 10%
- Your new ownership: 90%
Equity dilution occurs when a company issues new shares, reducing the ownership percentage of existing shareholders. While dilution decreases your percentage ownership, it doesn't necessarily decrease the value of your stake if the investment increases the company's overall valuation.
Tips & Best Practices
- •Aim for 15-20% dilution per round - This is typical for early-stage funding
- •Consider the valuation - A higher valuation means less dilution for the same investment
- •Plan for future rounds - Most startups raise multiple rounds; ensure you maintain meaningful ownership
- •Reserve option pool - Consider allocating 10-15% for employee stock options before the investment
- •Negotiate terms - Don't just focus on valuation; other terms (liquidation preference, anti-dilution) matter too
Frequently Asked Questions
Related Tools
💡 Quick Tips
- •All calculations happen in your browser - your data is private
- •Results update in real-time as you type
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