ESOP Dilution Calculator
VCs require ESOP top-up to 10-15% post-money. Top-up shares come from pre-money (founders dilute). This shows the impact on founder ownership.
| Pre-money | — |
| Post-money | — |
| New investor stake | — |
| Existing ESOP | — |
| Target ESOP | — |
| Top-up needed | — |
| Founder post-round | — |
| ESOP post-round | — |
ESOP (Employee Stock Option Pool) top-up at funding requires bringing pool to a target post-money percentage. Standard term: top-up shares come from pre-money (existing shareholders dilute), not from new investor's stake.
ESOP Top-Up Math
Top-up % = target post-money pool - existing pool. Pre-factor = 1 - (top-up / (1 - new investor %)). Existing shareholders multiply by pre-factor; investor stake unchanged.
Negotiation Lever
If you negotiate POST-money pool (shared dilution), top-up dilutes investor + founders together. Worth fighting for — every 1% top-up = ~1% founder dilution at standard terms.
Hidden Cost
VCs often pitch '$20M pre + $5M raise = $25M post'. But after 12% ESOP top-up from 5%, effective pre-money is closer to $18.2M. The 'top-up' is hidden dilution.
Typical Pool Sizes by Round
Seed: 5-10% post-money. Series A: 10-15%. Series B: 12-18%. Series C+: 15-20%. Larger pools at later rounds reflect ongoing hiring needs.
Last updated May 2026. Sources: Carta Cap Table, NVCA Term Sheet.