ESOP & Equity Dilution Calculator
Model your equity cap table after a funding round — see founder dilution, investor %, ESOP pool, and stake value at current valuation.
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How this calculator works
Every funding round dilutes founders. This calculator models what happens to your equity when you raise at a given pre-money valuation, create an ESOP pool, and issue new shares to investors. Understanding dilution math is critical before signing a term sheet — the post-money valuation alone doesn't tell you what % you own.
Post-money = Pre-money + Investment | Investor% = Investment ÷ Post-money | Founder post = Founder pre% × (1 − Investor%) × (1 − ESOP%) | Founder value = Founder% × Post-money
Last updated: March 2026 · Rates and slabs updated for FY 2025-26
ESOP pool comes from founders
Investors typically require the ESOP pool to be created before the investment — meaning it dilutes founders, not investors.
Watch for anti-dilution clauses
Ratchet and full-ratchet anti-dilution provisions in term sheets can devastate founder stakes in down rounds. Always read the fine print.
ESOP motivates the team
A 10–15% ESOP pool in early stage is standard. Split it thoughtfully — a good ESOP plan is your best retention tool for key hires.
Frequently Asked Questions
Investors typically require the ESOP pool to be created before the investment — meaning it dilutes founders, not investors.
Ratchet and full-ratchet anti-dilution provisions in term sheets can devastate founder stakes in down rounds. Always read the fine print.
A 10–15% ESOP pool in early stage is standard. Split it thoughtfully — a good ESOP plan is your best retention tool for key hires.