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Cap table dilution, from pre-seed to Series C

Most founders can quote their post-money valuation but can't tell you what they actually own. Then they raise three more rounds and the gap widens.

The 30-second version

Pre-money = company value before the round.
Post-money = pre-money + new money raised.
Investor's ownership = new money ÷ post-money.
Everyone existing gets diluted by exactly that ratio.

Raise $5M at a $20M pre-money. Post-money = $25M. Investor owns $5M / $25M = 20%. Everyone existing is now at 80% of what they had.

The option pool shuffle

Term sheets often require the option pool to be expanded before the round closes, so the dilution from the pool falls entirely on existing shareholders. A "10% pool refresh in the pre-money" is the most common version, and it can quietly cost founders 5–8% of their company.

SAFE conversion

SAFEs sit on the cap table as a promise. When the priced round closes, they convert at whatever's lower: the cap price, or the round price (with discount). A founder who took five SAFEs at different caps can be very surprised at how much they convert into at Series A.

A four-round walkthrough

Round	Raise	Post-money	Founder ownership
Pre-seed	$500k	$5M	90%
Seed	$2M	$10M	72%
Series A	$8M	$32M	54%
Series B	$20M	$100M	43%

And that's before option pool expansions, secondaries, or the next round. By Series C most founders are below 30%.

Try it

FundSim's VC simulator lets you build a multi-round cap table, add SAFE notes with caps and discounts, model the option pool, and run exit scenarios for founders, employees, and each investor cohort.

Open the cap table simulator ›