Founder Dilution Simulator
Equity dilution is the reduction in your ownership percentage as new shares are issued in funding rounds. This simulator models multiple rounds of financing so you can see how dilution compounds over time, including the impact of option pool expansion at each stage.
Add funding rounds below, configure each round's terms, and instantly see your cumulative dilution, ownership percentage, and equity value through every stage.
Starting Position
Results
Enter your starting position and at least one round's details to see the dilution analysis.
How Founder Dilution Works
Dilution compounds across rounds. Each time new shares are issued to investors, your ownership percentage decreases. A founder who starts with 80% ownership can end up below 20% after several rounds of financing. The key insight is that dilution is multiplicative, not additive: if you are diluted 20% in each of three rounds, your final ownership is not 80% - 60% but rather 80% x 80% x 80% = 51.2%.
The option pool shuffle is one of the most misunderstood mechanics in venture financing. When investors require an option pool to be created or expanded before their round, the dilution from that pool comes entirely from existing shareholders. This means the pre-money valuation is effectively lower than it appears, because a portion of it is allocated to the pool rather than existing equity holders.
Typical dilution benchmarks: At the Pre-Seed stage, founders typically give up 15-25% of the company. Seed rounds usually result in another 15-25% dilution. Series A rounds similarly dilute founders by 15-25%. By the time a company reaches Series B, founders who started at 100% may hold 25-40% of the company, depending on how much they raised and at what valuations.
Equity value vs. ownership percentage. While your percentage decreases with each round, the value of your remaining equity should increase if the company's valuation grows faster than your dilution. A smaller slice of a much larger pie can be worth significantly more. This is why founders should focus on both ownership percentage and the absolute value of their stake.