Finance
Dilution & Cap Table Simulator
= 20.000.000.000 ₫
= 5.000.000.000 ₫
Founder ownership after the round
| Party | Pre-round | Post-round |
|---|---|---|
| Founders & team | 100.0% | 70.0% |
| New investors | 0.0% | 20.0% |
| Option pool (ESOP) | 0.0% | 10.0% |
Post-money: 25,0B ₫ · New investors take 20.0% for 5,0B ₫
How this tool helps and the terms you need to know
When to use this tool
- When preparing data for capital calling documents.
- When you need a quick estimate before discussions with investors.
- When planning several consecutive funding rounds and wanting to estimate the ownership remaining after each one.
Basic calculation
Post-money valuation = Pre-money valuation + New capital raised New investor stake = New capital raised ÷ Post-money valuation Option pool stake = Pool allocation calculated on the post-money valuation Founder stake after the round = 100% − New investor stake − Option pool stake
The pre-money valuation is the company value both parties agree on before new capital is injected. Adding the new capital gives the post-money valuation, the company's value immediately after receiving investment. The investor's ownership equals the amount they contribute divided by the post-money valuation. If the round allocates an option pool under the convention of setting it before the round, the shares for the pool come out of existing shareholders' stakes, so the founding team's remaining share equals 100% minus both of the above.
Example: A business is valued at VND 20 billion pre-money and raises VND 5 billion while allocating a 10% option pool. The post-money valuation is VND 25 billion; the new investor holds 5 ÷ 25, or 20%; the option pool accounts for 10%; and the founding team is left with 70% instead of the 100% held before the round — a dilution of 30%.
Terms used in this tool
- Pre-money valuationPre-money valuation
- The company value agreed by both parties before new capital is injected. It is the basis for setting the price per share in the round.
- Post-money valuationPost-money valuation
- The company's value immediately after receiving investment, equal to the pre-money valuation plus the new capital raised. Investor ownership is always calculated on this figure.
- DilutionDilution
- The reduction in existing shareholders' ownership percentage when the company issues additional shares. Note that dilution reduces the percentage held, but if the valuation rises enough the absolute value of that holding can still increase.
- Option poolEmployee stock option pool
- Shares set aside to grant purchase rights to key personnel, commonly known as an ESOP. Investors typically require the business to maintain a pool large enough to recruit and retain its team.
- Option pool shuffleOption pool shuffle
- The convention of creating the option pool immediately before the round closes and counting it within the pre-money valuation. All dilution caused by the pool then falls on existing shareholders while the new investor's stake is unaffected. This is a point to review carefully when negotiating terms.
- Post-round ownershipPost-round ownership
- The percentage each party holds once the round completes, as shown on the cap table. It is the basis for voting rights and for distributions in a liquidity event.
How to read the results
10 – 20% dilution per round
The common range by industry convention for a typical funding round. The founding team retains a controlling stake and keeps room for subsequent rounds.
20 – 30% dilution per round
Still frequently seen in practice, particularly in early rounds or when the business needs a large amount of capital. Model the ownership remaining after another two or three rounds so you are not caught out.
Above 30% dilution per round
A high level that warrants careful consideration. The usual causes are a valuation that is low relative to the amount raised, or a large option pool created before the round. Review both factors with legal counsel before signing.
Founder's Toolkit