# Startup Valuation and Dilution Calculator | Aalekh > Solve pre money, post money, investment or equity from any two inputs, and model founder dilution and the ESOP pool impact. Canonical URL: https://www.aalekh.ai/calculators/startup-valuation [All calculators](/calculators) For businessesRates reviewed September 2026 # Startup Valuation Calculator: Pre and Post Money A startup valuation calculator ties together four numbers that a priced funding round always shares: the investment amount, the equity percentage the investor receives, the pre-money valuation and the post-money valuation. Fix any two and the other two are determined. That is why a term sheet quoting a cheque size and a percentage is already telling you the valuation, whether or not it names one. The relationship is arithmetic, not judgement. Post-money is simply pre-money plus the new investment, and the investor's stake is the investment divided by the post-money figure. Judgement enters earlier, when you argue for a pre-money number, and later, when you decide how much of the cap table to set aside for employees. The calculator handles the arithmetic so the discussion can stay on the parts that are actually negotiable. It supports multiple currencies, so a round priced in US dollars can be modelled alongside an Indian rupee cap table without converting by hand. The mathematics is currency-agnostic, and so is the dilution logic, which makes this page as useful for a founder in Bengaluru raising from a domestic fund as for one raising a SAFE-priced seed abroad. ## Startup Valuation Calculator What you already know Any two of the four fix the other two. Investment and pre-money valuationInvestment and equity percentagePre-money valuation and equity percentagePost-money valuation and investment Currency Keep a single currency across every figure in the round. Indian rupee (₹)US dollar ($)Euro (€)Pound sterling (£)Singapore dollar (S$)UAE dirham (AED) Investment ₹ Pre-money valuation ₹ Founders' stake before the round % ESOP pool created pre-money A pool carved out before the round comes wholly from existing shareholders. Set it to 0 for no pool. % Post-money valuation ₹10,00,00,000 investor 20%, founders 70% Pre-money valuation₹8 crore ₹8,00,00,000 Investment ₹2,00,00,000 Post-money valuation₹10 crore ₹10,00,00,000 Investor equityinvestment ÷ post-money 20% ESOP pool (pre-money) 10% Founders after the roundfrom 100% before 70% Founder dilution (percentage points)30% of the stake held before the round 30% Founders if the pool came post-moneyinvestor would fall to 18% 72% - A pre-money pool is carved out of the existing shareholders, so the founders bear the whole cost of it while the investor still receives the full agreed percentage. - Dilution compounds across rounds. Model the next round alongside this one before agreeing a price. ## The formula Post-money = Pre-money + Investment; Equity % = Investment ÷ Post-money Pre-money What the business is agreed to be worth immediately before the new money lands. Investment The cash the round brings in, in exchange for newly issued shares. Post-money Pre-money plus the investment, the figure the round is actually priced on. Equity % The share of the post-round cap table the new investor ends up holding. Because the four are linked, any two of them fix the remaining two, so a term sheet quoting only investment and equity still implies a specific pre-money valuation. ## How to calculate it 1. 1 ### Decide which two numbers you actually know Most conversations start from one of two places: an investor offers a cheque at a stated pre-money, or an investor offers a cheque for a stated percentage. Either pair is enough. Write down the two you have before reaching for the third, because assuming a post-money when the term sheet meant pre-money is a costly misreading. 2. 2 ### Solve for post-money If you know pre-money and investment, add them. If you know investment and the equity percentage, divide the investment by the percentage: a ₹2 crore cheque for 20 percent implies a ₹10 crore post-money. If you know pre-money and percentage, divide pre-money by one minus the percentage. 3. 3 ### Derive the investor's stake Divide the investment by the post-money valuation. Note that dividing by pre-money instead gives a larger, wrong number, and the gap widens as the round gets bigger relative to the company. On a round that is half the post-money, the two methods differ by a factor of two. 4. 4 ### Work out founder dilution Existing shareholders as a group retain one minus the new investor's percentage, and each of them is scaled down in the same proportion. A founder on 60 percent before a 20 percent round holds 60 percent × 80 percent = 48 percent after. Dilution compounds across rounds, so model the next round at the same time as the current one. 5. 5 ### Place the ESOP pool deliberately An option pool created before the round is carved out of the existing shareholders' stake, which effectively lowers the pre-money valuation for the founders even though the headline number does not move. A pool created after the round dilutes the new investor too. This single choice often moves founder ownership more than a round of haggling over the valuation itself. 6. 6 ### Sanity check against the runway Work back from the plan: how many months does the raise buy, and what milestone does it reach. A round that leaves less than twelve to eighteen months of runway usually means raising again before the metrics justify a higher price, which is a slower path to the same ownership than taking slightly more dilution now. ## Any two of the four inputs solve for the rest Any two of the four inputs solve for the rest What you know What follows Investment and pre-money Post-money = pre-money + investment; equity % = investment ÷ post-money Investment and equity % Post-money = investment ÷ equity %; pre-money = post-money - investment Pre-money and equity % Post-money = pre-money ÷ (1 - equity %); investment = post-money - pre-money Post-money and investment Pre-money = post-money - investment; equity % = investment ÷ post-money ## Worked example Investment ₹2,00,00,000 (₹2 crore) Pre-money valuation ₹8,00,00,000 (₹8 crore) Founders before the round 100% ESOP pool agreed 10% of the post-round cap table, carved out pre-money - Post-money = ₹8,00,00,000 + ₹2,00,00,000 = ₹10,00,00,000 - Investor equity = ₹2,00,00,000 ÷ ₹10,00,00,000 = 20% - Founders retain 100% - 20% = 80% before the option pool - The 10% pool comes out of the pre-money cap table, so founders go to 80% - 10% = 70% - Had the pool been created after the round, the investor would have been diluted to 18% and founders to 72% Post-money ₹10 crore, investor 20 percent, ESOP 10 percent and founders 70 percent after a pre-money pool ## Frequently asked questions What is the difference between pre-money and post-money valuation? Pre-money is the agreed value of the company immediately before the new investment arrives; post-money is that figure plus the investment itself. A ₹2 crore round at a ₹8 crore pre-money is the same deal as a ₹10 crore post-money. Confusing the two costs the founder real ownership, because at a ₹10 crore pre-money the same cheque would buy only about 16.7 percent. How do I calculate the equity an investor gets? Divide the investment by the post-money valuation. A ₹2 crore investment at a ₹10 crore post-money gives 20 percent. If the term sheet quotes a pre-money figure, add the investment to it first, then divide. Can I work backwards from the equity percentage to a valuation? Yes, and this is the most common real-world case. Divide the investment by the percentage to get post-money, then subtract the investment to get pre-money. An investor asking for 25 percent for ₹5 crore is pricing the company at ₹20 crore post-money and ₹15 crore pre-money, whether or not those numbers appear anywhere in the document. How much do founders get diluted in a round? Existing shareholders collectively give up the new investor's percentage, and each is reduced proportionately. A founder holding 60 percent before a round that sells 20 percent ends up with 48 percent. The effect compounds, so three consecutive 20 percent rounds leave that founder near 30 percent before any option pool is considered. How does an ESOP pool change the numbers? If the pool is created before the round, it comes out of the existing shareholders' holdings and the new investor still gets the full agreed percentage, so the founders bear the entire cost. If it is created after the round, every shareholder including the new investor is diluted. Investors usually prefer the first, which is why the timing of the pool is worth negotiating as hard as the valuation. Does this calculator handle currencies other than the rupee? Yes. The relationships between investment, equity, pre-money and post-money hold in any currency, and the calculator lets you pick the one your round is denominated in. Just keep a single currency across all four inputs, since mixing a dollar cheque with a rupee valuation produces a meaningless percentage. Is there a tax consequence in India to the valuation you agree? Historically, shares issued above fair market value to resident investors attracted tax in the hands of the company under section 56(2)(viib), commonly called angel tax. That provision was abolished for all classes of investors in the Union Budget 2024-25 and does not apply from assessment year 2025-26. Valuation still matters for other purposes, including pricing rules for non-resident investment and section 56(2)(x) in the hands of a recipient of shares, so take specific advice on a live round. ## Sources Rates and rules on this page come from the following. This is a working aid, not professional advice: confirm anything material with your Chartered Accountant before you act on it. - [PIB: Angel tax abolished for all classes of investors](https://www.pib.gov.in/PressReleaseIframePage.aspx?PRID=2035599) - [Income Tax Department: Exemption from angel tax, section 56(2)(viib)](https://www.incometaxindia.gov.in/w/exemption-from-angel-tax-section-56-2-viib-) - [Startup India: DPIIT startup recognition and tax exemption](https://www.startupindia.gov.in/content/sih/en/startupgov/startup_recognition_page.html) ## Stop re-keying these figures Aalekh runs this calculation on your actual client data, pulls the underlying ledgers straight from Tally, and carries the result through to the financial statements and the return. [Get Started](/page-pricing)[Book a demo](/page-contact) ## Related calculators - [ ### Income Tax Calculator New regime and old regime slabs, surcharge, marginal relief and rebate for FY 2026-27 and FY 2025-26. 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