{
  "rogueId": "fundraising.founder_dilution",
  "slug": "founder_dilution",
  "domain": "fundraising",
  "defaultLabel": "Founder Dilution",
  "description": "Percentage of founders' fully-diluted ownership that is given up in the new round, including any pre-close option-pool top-up (the \"option pool shuffle\" — option-pool expansion taken in the pre-money dilutes existing holders rather than new investors). Common pitfall: founders often quote the \"investor dilution\" (new money / post-money) and forget the option-pool top-up component. The Carta State of Private Markets quarterly reports publish stage-typical dilution ranges that boards should use as a sanity check.",
  "fieldType": "percentage",
  "unit": "%",
  "maturity": "general",
  "suggestedForStages": [
    "preSeed",
    "seed",
    "seriesA",
    "seriesB",
    "seriesC"
  ],
  "defaultOwningFunctions": [
    "Finance"
  ],
  "stageRelevance": {
    "preSeed": "core",
    "seed": "core",
    "seriesA": "core",
    "seriesB": "core",
    "seriesC": "core"
  },
  "definitionSource": {
    "tier": "published",
    "sourceName": "Carta State of Private Markets Q3 2025",
    "sourceUrl": "https://carta.com/data/state-of-private-markets-q3-2025/",
    "sectionRef": "Seed Round Dilution",
    "publicationDate": "2025-10-01",
    "attributionNotice": null
  },
  "benchmark": {
    "p25": 12,
    "median": 18,
    "p75": 24,
    "unit": "%",
    "sourceName": "Carta State of Private Markets Q3 2025",
    "sourceYear": "2025",
    "higherIsBetter": false
  },
  "formula": "founder_dilution_pct = (founder_shares_pre − founder_shares_post) / founder_shares_pre × 100. Includes both new-money dilution and any pre-close option-pool top-up borne in the pre-money. Per Carta State of Private Markets methodology.",
  "whyItMatters": "Tracks founder skin-in-the-game over time — sustained ownership matters for long-term motivation and signaling to future investors. Boards balance dilution discipline against capital needs.",
  "interpretationGuidance": "Per Carta State of Private Markets benchmarks, typical per-round dilution for the priced round (excluding pool top-up) is 18–22% at seed, 18–22% at A, 12–18% at B, 10–15% at C+. Out-of-band dilution either signals weak negotiating position or a strategic priced-up next-round set-up.",
  "relatedKpiIds": [
    "fundraising.pre_money_valuation",
    "fundraising.post_money_valuation",
    "fundraising.total_round_size"
  ]
}