[Verse 1] Sarah's got a startup, brilliant idea in hand Needs some cash to grow it, help her business expand Before investors come in, what's her company worth? That's pre-money valuation, the value at birth [Chorus] Pre before, post after, money coming in Pre before, post after, let the math begin Add investment to pre-money, post-money you'll see Valuation made simple, now you hold the key [Verse 2] Her company's worth two million, that's the pre-money price Investor brings in five hundred, rolling the dice Two plus point five million, equals two point five That's post-money value, keeps the dream alive [Chorus] Pre before, post after, money coming in Pre before, post after, let the math begin Add investment to pre-money, post-money you'll see Valuation made simple, now you hold the key [Verse 3] Ownership percentages, now let's break it down Investment over post-money, spins the numbers around Five hundred over two point five, equals twenty percent Investor owns one-fifth now, that's how the pie is rent [Bridge] Remember the formula, it's easy as can be Pre-money plus investment equals post-money Then divide investment by the post-money sum That's investor ownership, now you're having fun [Chorus] Pre before, post after, money coming in Pre before, post after, let the math begin Add investment to pre-money, post-money you'll see Valuation made simple, now you hold the key [Outro] When valuations puzzle you, just think of this song Pre before, post after, you can't go wrong
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