Post-Money Valuation
The company's value immediately after new investment capital is added, equal to pre-money plus the new round.
Post-money valuation is what a company is worth the moment a financing closes, including the fresh capital just raised. It's the denominator used to calculate every investor's ownership percentage in that round.
Because post-money SAFEs now dominate seed financing, founders increasingly negotiate valuation caps in post-money terms directly, which makes dilution math simpler but means each new SAFE cap already accounts for prior SAFEs — stacking several post-money SAFEs at different caps can silently push founder ownership down faster than founders expect until they model it explicitly.
Post-money is the number that actually determines who owns what. Every share count, option pool percentage, and investor stake divides by it.
Y Combinator's standard deal shows the post-money mechanics clearly: $125,000 for a fixed 7% implies a post-money cap of roughly $1.79M ($125,000 / 0.07), and that 7% is set at signing. The Accelerator entry covers the rest of YC's deal.
Always say which valuation you mean. Founders announcing 'we raised at $20M' without saying pre or post create confusion for employees, future investors, and the press.
Investor ownership % = amount invested / post-money valuationA $2M seed round closes at a $10M post-money valuation. The new investors collectively own $2M / $10M = 20% of the company immediately after closing.
When comparing term sheets, always normalize to post-money ownership percentage rather than headline valuation — a higher pre-money number with a bigger option pool requirement can leave founders with less ownership than a lower headline offer.
Why do post-money SAFEs matter for dilution?
Because the cap is set after the round, each SAFE's ownership percentage is fixed and doesn't get further diluted by other SAFEs in the same round, so founders can precisely calculate cumulative dilution before signing anything.
Do post-money SAFEs stack?
Yes. Each post-money SAFE independently claims its percentage: a $1M SAFE on a $12M post-money cap is about 8.33%, so three of them add up to 25% regardless of what priced round follows. SAFEs at different caps don't average out — they add up.
Does post-money valuation include the option pool?
The pool is part of the company's capitalization, so it sits inside post-money. The real question is whether the pool was created inside the pre-money (common in US deals, diluting existing holders) or on top of it.
How does post-money valuation relate to price per share?
Price per share is the valuation divided by the fully diluted share count, applied consistently. Investors divide post-money by post-round fully diluted shares to get the price they pay.
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Related terms
Run the numbers yourself: dilution, SAFE conversion, and fund-returner calculators.