Fundraising

Post-Money Valuation

Definition

Post-money valuation is what a company is worth immediately after a new round closes: the pre-money valuation plus the new money raised.

A company raising $1.5M on an $8.5M pre-money valuation ends up at a $10M post-money valuation. That $10M is also the figure used to calculate how much of the company the new investors actually own: $1.5M divided by $10M, or 15%.

Post-money valuation becomes the pre-money valuation of the next round, adjusted for whatever's changed in between, which is part of why getting today's number right matters well beyond the round it's attached to.

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