[Verse 1] Sarah built a startup from her kitchen table dreams Revenue climbing, users growing, bursting at the seams Venture capital comes knocking with a ten million check But first they need to calculate what her company's worth [Chorus] Pre-money, post-money, know the difference well Pre is what you're worth before the capital bell Post includes investment, total pie gets wide Pre-money plus investment equals post-money ride [Verse 2] Sarah's company valued at twenty million pre Investors bring ten million, simple math you see Pre-money twenty, plus investment ten makes thirty That's your post-money valuation, clean and sturdy [Chorus] Pre-money, post-money, know the difference well Pre is what you're worth before the capital bell Post includes investment, total pie gets wide Pre-money plus investment equals post-money ride [Bridge] Ownership slices, equity stakes Calculate carefully what percentage it takes Ten into thirty gives investors one-third Sarah keeps two-thirds, dilution's the word [Verse 3] If they valued post-money thirty from the start Sarah's slice shrinks smaller, tears her equity apart Always clarify which valuation they mean Pre or post determines your ownership scene [Chorus] Pre-money, post-money, know the difference well Pre is what you're worth before the capital bell Post includes investment, total pie gets wide Pre-money plus investment equals post-money ride [Outro] Before the cash or after cash Your equity depends on math Pre-money protects your share Post-money means dilution's there
← Fund Structure: GPs, LPs, and Key Terms | Comparable Company Valuation Method →