Pre-Money Valuation
Company valuation negotiated with investors immediately before the new round closes — the denominator for the new investors' ownership math. Per the NVCA Model Documents, pre-money = post-money − new money raised. Common pitfall: when convertible instruments (SAFEs, notes) are outstanding, the "headline" pre-money the CEO quotes and the effective pre-money after conversion can differ materially — the board should always ask for both. Equally important: option-pool top-ups taken pre-close come out of the pre-money share count, diluting founders not investors (the "option pool shuffle"). — Fundraising KPI anchored to NVCA Model Legal Documents (2024 revision).
Rogue ID: fundraising.pre_money_valuation
Type: Currency
Domain: Fundraising
Definition
Company valuation negotiated with investors immediately before the new round closes — the denominator for the new investors' ownership math. Per the NVCA Model Documents, pre-money = post-money − new money raised. Common pitfall: when convertible instruments (SAFEs, notes) are outstanding, the "headline" pre-money the CEO quotes and the effective pre-money after conversion can differ materially — the board should always ask for both. Equally important: option-pool top-ups taken pre-close come out of the pre-money share count, diluting founders not investors (the "option pool shuffle").
Formula
pre_money_valuation = post_money_valuation − total_round_size. Per NVCA Model Documents convention. Effective pre-money after SAFE/note conversion can be lower than headline — surface both when convertibles are material.Why it matters
Sets the price for the round. Drives founder_dilution, the option-pool top-up math, and the precedent for the next round (down-rounds are punishing to recover from).
How to interpret
Compare to stage-relative ranges from quarterly Carta / PitchBook reports (e.g. seed median has moved $12–18M post-money in 2024–2025). A pre-money below stage median typically signals either harsher terms or a strategic discount; above stage median demands real metric backing.
Related KPIs
fundraising.post_money_valuationfundraising.total_round_sizefundraising.founder_dilutionfundraising.convertible_outstanding
Source
NVCA Model Legal Documents (2024 revision) · section: Series A Charter — Original Issue Price — published 2024-01-01.
Why does this cite NVCA Model Legal Documents (2024 revision)? Read the ontology methodology for the published vs editorial tier system, attribution rules, and dispute process.
Stage relevance
| Company stage | Priority |
|---|---|
| Pre-Seed | Core |
| Seed | Core |
| Series A | Core |
| Series B | Core |
| Series C+ | Core |
Suggested for stages: Pre-Seed, Seed, Series A, Series B, Series C+.
Default owning functions
- Finance
Machine-readable
- This KPI as JSON:
/api/ontology/fundraising/pre_money_valuation.json - All Fundraising KPIs:
/api/ontology/fundraising.json - Full catalog:
/api/ontology/index.json
Post-Money Valuation
Company valuation immediately after the new round closes, including the new capital raised — the canonical "valuation" number quoted in TechCrunch headlines. Per NVCA Model Documents, post-money = pre-money + new money raised. Common pitfall: post-money math gets messy with SAFEs — modern post-money SAFEs (the YC 2018+ form, per the Y Combinator SAFE primer) fix dilution at the SAFE's valuation cap regardless of subsequent priced-round pricing, so the board should always reconcile the headline post-money against the fully-diluted cap table. — Fundraising KPI anchored to NVCA Model Legal Documents (2024 revision).
Total Round Size
Total new capital being raised in the current round across all participants — the lead, follow-on investors, employee/strategic allocations, and any side-letter pieces. This is the figure that goes into the post-money math. Common pitfall: companies sometimes confuse `total_round_size` with `target_raise` — the round size is final and used in valuation math, while the target is what management is aiming for and can move during the raise. Boards should expect a specific breakdown by investor when this number is reported. — Fundraising KPI anchored to NVCA Model Legal Documents (2024 revision).