Pre-seed Dilution Calculator

Pre‑seed is where cap tables are set up for success—or pain later. This guide gives you a quick way to estimate dilution for priced equity and post‑money SAFEs, shows how ESOP top‑ups change the maths, and includes a simple chart you can copy. We use realistic ranges and MENA‑aware notes so you can decide how much to raise and when.

Key takeaways: Typical pre‑seed dilution lands between 10–25% depending on round size, valuation and whether you expand the ESOP. Equity rounds dilute by raise ÷ post‑money; post‑money SAFEs fix investor % at investment ÷ valuation cap (before the next priced round). Plan your ESOP to ~10–15% post‑money. Avoid stacking uncapped SAFEs; align on a clean cap and definitions early.

Use these ranges to frame your round, then model scenarios before you sign.

Quick answer: how much should you expect to give up?

Directionally 10–25% is common at pre‑seed. Smaller rounds at stronger valuations sit near 10–15%; larger raises or lower valuations can push 20–25%+.

Ranges vary by market and traction. In the GCC and wider MENA, investor appetite in 2025 improved, yet efficiency and clarity on instruments matter. Founders should model priced equity and SAFE scenarios, include ESOP top‑ups, and sanity‑check how today’s choices affect Series A ownership later.

Why ranges vary

Ticket size, traction quality (retention, payback), and instrument type drive outcomes. Post‑money SAFEs accumulate fixed percentages that convert at the next priced round, so multiple SAFEs can stack up quickly.

The maths (priced equity vs post‑money SAFE)

Equity: dilution = raise ÷ (pre‑money + raise). Post‑money SAFE at cap: investor % ≈ investment ÷ post‑money valuation cap (pre‑Series A).

For a priced round: if you raise $500k at a $4.5m pre‑money, post‑money is $5.0m and dilution ≈ 10%. For a post‑money SAFE with a $5.0m cap and a $500k cheque, the investor’s % is fixed at ~10% until the priced round—then everyone dilutes together. Discount‑only SAFEs convert at a discount to the priced round share price; the exact % depends on the Series A price.

ESOP effects

If your investor requires a 10–15% ESOP ‘post‑money’, you may need to create or top‑up ‘pre‑money’. That pushes more dilution to founders before the round. Model both the pool top‑up and the financing instrument together.

Copy‑paste scenarios (table)

Use this table to ballpark founder dilution by raise size and pre‑money valuation. It assumes a priced round without ESOP changes.

Chart: dilution vs valuation (illustrative)

Dilution falls as pre‑money rises. For a $500k raise, moving from a $3m to $6m pre‑money halves dilution from ~14.3% to ~7.7%.

The chart plots three raise amounts ($300k, $500k, $1m) against valuations from $2m to $10m. Use it to sense‑check negotiation outcomes; small valuation moves have large ownership impacts at pre‑seed.

MENA‑specific notes (2025)

H1‑2025 funding rebounded in MENA, led by KSA and the UAE. Clean documents and local references reduce friction; caps and pools should be explicit.

Market momentum returned in 2025, but scrutiny on efficiency remained. Founders using SAFEs should share the YC post‑money SAFE guide and confirm cap definitions, pro‑rata, and MFN. Priced rounds should reference standard NVCA terms (e.g., 1× non‑participating preference) to keep legals clean.

Core Web Vitals for your fundraising site

Target INP ≤200 ms, LCP ≤2.5 s, CLS ≤0.1. Optimise hero media (≤150 KB WebP), preconnect fonts/CDNs, and reserve space for embeds to avoid layout shifts.

Pre‑moneyRaiseDilution (priced)$2m$300k13.04%$2m$500k20.0%$2m$1000k33.33%$3m$300k9.09%$3m$500k14.29%$3m$1000k25.0%$4m$300k6.98%$4m$500k11.11%$4m$1000k20.0%$6m$300k4.76%$6m$500k7.69%$6m$1000k14.29%$8m$300k3.61%$8m$500k5.88%$8m$1000k11.11%

Worked examples you can adapt

Example A (priced equity): Raise $500k at $4.5m pre. Post‑money = $5.0m; investor new money owns 10.0%; founders + existing dilute by 10.0%.
Example B (post‑money SAFE): $300k at a $6.0m cap fixes ~5.0%. Add a second $300k SAFE at the same cap and you’ve pre‑sold ~10% before the priced round; at Series A everyone dilutes again from that base.
Example C (ESOP top‑up): Founders 80%, ESOP 5%, angels 15%. Investor requires 12.5% ESOP post‑money and 15% new money. Top‑up the pool pre‑round (from 5% to 12.5%); then sell 15% new. Founders end ~70% (illustrative).

How to sanity‑check forward ownership

Model seed at ~15–20% and Series A at ~15–20% new money. If founders fall below ~50% common before Series B, reconsider round size/valuation or defer ESOP expansion.

Cap table hygiene and definitions

Be explicit about what “pre‑” and “post‑money” include. YC post‑money SAFEs define investor ownership as investment ÷ post‑money valuation cap; that percentage is before the next priced round. NVCA‑style priced rounds commonly use a clean 1× non‑participating liquidation preference; confirm ESOP sizing (pre vs post) in the term sheet. Keep a definitions page in your data room to avoid confusion across NDAs and drafts.

Checklist to avoid surprises

One spreadsheet of truth (fully diluted); option pool count correct; all SAFEs/notes summarised with caps/discounts/MFN; pro‑rata rights listed; and a clear ESOP policy (grant cadence, refresh rules, target range).

SAFE vs priced round: which should you choose at pre‑seed?

Pick the instrument that reduces friction while keeping ownership sensible.

Post‑money SAFEs are fast and standardised; they minimise legal costs and let you close incrementally. Priced rounds provide immediate price discovery and clearer ownership today, but take longer and cost more. If you are stacking SAFEs, be explicit about caps, MFN, and pro‑rata, and publish a simple summary table in your data room.

Pros and cons (quick list)

• Post‑money SAFE: fast, low legal cost, fixed investor %; watch outs: stacking %, MFN interactions, and cap definition.
• Priced equity: clean ownership today, board & governance clarity; watch outs: higher legal lift, time to close, more diligence.

Negotiation traps to avoid

Small wording changes can move real percentages.

Ambiguity around whether ESOP is pre‑ or post‑round; SAFE caps specified as pre‑ vs post‑money; discount‑only SAFEs layered with MFN; pro‑rata rights that include super pro‑rata above ownership. Keep a term sheet addendum spelling out definitions and a one‑page cap table showing fully diluted ownership before and after the round.

Good‑faith guardrails

Share a redacted YC SAFE user guide link, propose NVCA‑style terms for priced rounds, and set a realistic closing window. Be transparent about other instruments outstanding.

Glossary (founder‑friendly)

Post‑money valuation: the value after new cash is added; in a priced round it’s pre‑money + new money; in YC post‑money SAFE, it’s the denominator for investor %.
Fully diluted: all shares as if every option, warrant, and convertible had been exercised/converted.
MFN: Most Favoured Nation; a later investor can elect better terms you gave someone else.
Pro‑rata: a right to maintain ownership % in future rounds by investing more.

FAQ

Short answers to the dilution questions we hear most from pre‑seed founders.

• Is 25% at pre‑seed too much?
  It can be fine if the cheque materially de‑risks milestones and you preserve room for seed and Series A. Model forward ownership.
• Do post‑money SAFEs always fix investor %?
  Yes—the % is investment ÷ post‑money cap, before the next priced round. At the priced round, everyone dilutes together.
• Should ESOP be created pre‑ or post‑round?
  Most investors want a 10–15% pool ‘post‑money’, which often means topping up before the round so it dilutes founders, not new money.
• What if I already have multiple SAFEs?
  Build a conversion schedule with each cap/discount and estimate the combined % at your target priced round. Consider consolidating if complexity is high.
• What documents should I use?
  YC post‑money SAFEs are widespread at pre‑seed. For priced rounds, align to NVCA‑style terms and keep liquidation preference to a clean 1× non‑participating.

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