💸 Raising Capital Isn’t Just About the Money. It’s About the Math.
Raising capital feels like a milestone — and it is.But it’s also the moment where the real math begins.
Raising capital feels like a milestone — and it is.
But it’s also the moment where the real math begins.
Access to Free Dilution Calculator Below
Many founders talk about pre-money and post-money valuations. Fewer understand precisely how that impacts their ownership.
Let’s break it down with no jargon, just clarity.
🧠 Pre-Money vs. Post-Money?
Pre-money = company value before investment
Post-money = pre-money + new investment
Example:
$4M pre-money + $1M raise = $5M post-money
🍕 What’s Dilution?
When you raise money, you issue new shares to investors.
You don’t lose your shares, but your percentage ownership shrinks.
Imagine your company as a pizza with 100 slices. You and your co-founder own it all.
An investor wants 20%. You bake more pizza — total slices = 125.
The investor gets 25 slices. You now own 80%, not 100%.
That’s dilution — and it’s not bad if the money fuels real growth.
📉 How to Stay Smart
Dilution becomes a problem only when it’s misunderstood.
Founders should:
✅ Model the cap table before & after each round
✅ Understand what they’re giving up — and gaining
✅ Avoid over-diluting too early
✅ Focus on growing total value, not just keeping %
✅ Think ahead: Seed → Series A → B → Exit
🧭 Clarity Is Power
Dilution isn’t the enemy. Confusion is.
The best founders own the math and shape the outcome.
You’re not just raising funds — you’re choosing partners and trading equity for acceleration. Done well, it’s worth it.
📊 Want a Free Dilution Calculator?
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