Skip to content
ENExplore Calculators

ESOP Pool Size Calculator

Work out esop pool size instantly with clear inputs, formula shown and shareable results.

About ESOP Pool Size Calculator

An option pool expressed as a percentage of post-issue equity has to be grossed up, because the new shares enlarge the denominator. Dividing existing shares by (1 - target pool) gives the fully diluted total, and the difference is the pool — which is why a 12% pool dilutes existing holders by 12%, not less.

Formulas

Fully diluted total

Total = Shares outstanding / (1 - Target pool %)

Pool shares

Pool = Total - Shares outstanding

Worked example

With the default values below, ESOP Pool Size Calculator returns New shares to reserve of 827,273. Change any input above and every figure here is recalculated in your browser.

Inputs used

Target pool as % of post-issue equity
12
Shares outstanding before the pool
9,000,000
Options already granted or reserved
400,000

Results

New shares to reserve
827,273
Total pool shares required
1,227,273
Fully diluted share count
10,227,273
Dilution created by the pool
12.00%

Step by step

  1. 1Values used
  2. 2Fully diluted total
  3. 3Pool shares
  4. 4New shares to reserve= 827,273
  5. 5Total pool shares required= 1,227,273
  6. 6Fully diluted share count= 10,227,273
  7. 7Dilution created by the pool= 12.00

Assumptions and limits

  • The result is derived only from the 3 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

Who bears the cost of the pool?

Usually existing shareholders, because investors insist the pool sits inside the pre-money valuation. That is the single most negotiated line in a term sheet.

How big should a pool be?

10-15% at Series A is typical, sized bottom-up from the hires planned before the next round rather than from a rule of thumb.

Related Calculators

ESOP Pool Size Calculator – Calculate New shares to reserve