Measure the dilution an employee share option pool creates for existing shareholders.
A 12% pool measured post-issue requires issuing more than 12% of the existing share count, because the new shares enlarge the denominator. Getting this backwards understates the dilution every time. Investors specify the pool as a post-money percentage precisely because it pushes the dilution onto existing holders rather than sharing it.
ESOP Dilution
Shares issued = existing ÷ (1 − target pool %) − existing
Shares issued = existing ÷ (1 − target pool %) − existing A 12% pool measured post-issue requires issuing more than 12% of the existing share count, because the new shares enlarge the denominator. Getting this backwards understates the dilution every time.
Investors specify the pool as a post-money percentage precisely because it pushes the dilution onto existing holders rather than sharing it.
This calculator takes 3 inputs: Shares outstanding before the pool, Target pool as share of post-issue equity, Your ownership before the pool. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.