Startup Equity Calculator
Founder dilution projection.
Calculate founder equity dilution across multiple funding rounds from initial equity and the dilution percentage in each round.
What this tool does
This tool projects how a founder's equity stake changes across multiple funding rounds and calculates the resulting proceeds at exit. It models the compounding effect of dilution—where each new investment round reduces the founder's ownership percentage—and estimates the monetary value of their remaining stake based on a specified exit valuation. The calculation is driven primarily by the number of rounds, dilution rate per round, and the final valuation. A typical use case is mapping how equity ownership evolves from seed through Series A, B, or later stages, and understanding what percentage ownership translates to in absolute terms at exit. Note that this tool assumes a linear dilution model and does not account for anti-dilution provisions, secondary sales, option pools, or variations in round structure. Results are illustrative and based on the inputs provided.
Quick answer: with the default values, the result is $40,960,000.00 (Founder Exit Proceeds). Adjust the values below for your own figures.
Enter Values
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Formula Used
Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Startup equity calculator projects founder equity through multiple dilution rounds. Founders typically start with 100%, dilute 15-25% per major funding round. After 4 rounds: 100% × 0.8^4 = 41% remaining. After 6 rounds: 26%. Famous example: Travis Kalanick held ~10% Uber at IPO, Jeff Bezos held ~16% Amazon at IPO.
Example: founder starts 100% equity. Seed dilution 20%, Series A 20%, Series B 20%, Series C 20%. Final: 100 × 0.8 × 0.8 × 0.8 × 0.8 = 41%. At 100M exit: founder gets 41M. With same dilution but option pool refreshes (additional 10% per round): final equity 27% = 27M at exit. Option pools matter.
Dilution comes from three sources: (1) New investor shares in funding rounds, (2) Option pool refreshes (new shares for employees), (3) Convertible note conversions. Founders should track fully-diluted ownership (assuming all options/notes converted), not just current share count. Rule of thumb: target 25-30% founder equity at IPO across founding team.
Quick example
With initial equity of 100% and number of funding rounds of 4 (plus dilution per round of 20% and exit valuation of 100,000,000), the result is 40,960,000.00.
Which inputs matter most
You enter Initial Equity %, Number of Funding Rounds, Dilution Per Round %, and Exit Valuation.
What's happening under the hood
Final equity = initial × (1 - dilution per round)^rounds. Exit proceeds = final equity × exit valuation.
Where this fits in planning
This is a "what-if" tool, not a forecast. It helps to test ideas: what happens to the result as the Initial Equity % or the Number of Funding Rounds changes. The value is in the scenarios you run, not the single answer you get from the defaults.
100% × (1-20%)^4 = $40,960,000.00 at £100,000,000 exit.
Inputs
| Final Equity % | 40.96% |
|---|---|
| Total Dilution | 59.04% |
| Initial Equity | 100.00% |
| Exit Valuation | $100,000,000.00 |
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
This calculator models founder equity ownership through multiple funding rounds and projects exit proceeds. It computes final equity ownership by applying the dilution formula: starting equity percentage is multiplied by (1 minus dilution per round) raised to the power of the number of rounds. This assumes dilution occurs uniformly across each round and compounds across all funding events. Exit proceeds are then calculated by multiplying the final equity percentage by the total exit valuation. The model treats dilution as a constant percentage per round and assumes no anti-dilution provisions, secondary sales, or changes in share structure between rounds. It does not account for option pools, employee grants, or variations in dilution across different funding stages.
References
Frequently Asked Questions
Typical dilution per round?
Founder vs option pool dilution?
Successful founders' final equity?
How to minimise dilution?
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