Dilution
The drop in your ownership percentage each time the company issues new shares.
Not inherently bad — a smaller slice of a far bigger pie is the whole point — but worth modelling round by round.
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Pre-money / Post-money valuation
Pre-money is what the company is worth before the new money goes in; post-money is pre-money plus the raise.
Option pool / ESOP
Equity set aside to grant to employees as options, usually 10–15% of the company.
Anti-dilution
A clause that adjusts an investor's shares if you later raise at a lower price, protecting them in a down round.
Down round
A raise at a lower valuation than your previous one.
Cap table
The ledger of who owns what — every shareholder, their share class and their percentage.
Pro rata rights
An investor's right to invest again in future rounds to maintain their ownership percentage.
Fully diluted
The share count assuming every option, SAFE and convertible has been exercised and converted.
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