Pre-Money and Post-Money Startup Valuation Calculator
You’ve got enough to be worried about when meeting with investors, so take a load off and use this startup valuation calculator instead. Yes, it’s impressive to be able to do this in your head, but it’s really not necessary.
This calculator tells you how much your startup is valued at before investment (pre-money) and then after investment (post-money). This conversation arises when an investor wants to invest a certain amount of cash in exchange for a specific amount of ownership (equity) of the company. If you are a very early stage company, you’re typically just happy that someone sees value in your company, all the hard work you’ve put into it, and that there’s actual dollar figures assigned to the value. However, the amount it’s valued at and the remaining amount of the company you’ll own at the end of fundraising is very important to understand. At TPM Focus, we typically advise founders to be reasonable and grateful to own 90% of something rather than 100% of nothing–with no value assigned, that’s essentially what it means to the marketplace. Also, on the other hand, understand that accepting investor funds also means losing some control of the decision-making for the company.
Each time you raise money as a priced round, whether it’s a seed, Series A, Series B, Series C, etc., these financial figures are simple, yet critical to know and understand. We don’t even need our typical acronym decoder for this one. Just enter in two (2) values and the calculator will do the rest!