Map Ownership Option Pools and Dilution Scenarios
Map out every existing share class, founder allocation, advisor agreement, and investor holding alongside proposed option pool sizes. Model full-dilution mathematics under various pre-money valuations and round sizes to visualise prospective ownership shifts.
Mapping these variables eliminates hidden dilution surprises and clarifies the net equity position of all parties post-investment. It guarantees that option pool creation and advisor equity do not unexpectedly erode founder incentive structures during negotiation.
Produce a dynamic, fully diluted equity waterfall model capturing current shareholdings, proposed advisor vests, pre- and post-money option pool additions, and multi-round dilution. Document the explicit mathematical rationale for the unallocated option pool size.
Five questions an expert would ask when reviewing your output
Use these to challenge assumptions, pressure-test your logic, and check the quality of this action's output in the context of the parent task and wider venture development.
- 1
What evidence justifies creating an option pool of this size before investment rather than post-money?
- 2
How do your advisor equity vesting schedules protect the business if an advisor fails to deliver value after six months?
- 3
Why did you assume a pre-money valuation at this level, and how does your model react if an investor demands a 20% haircut?
- 4
How severe is the economic and voting dilution for original founders across your worst-case scenario raise?
- 5
What specific anti-dilution or liquidation preference terms have you factored into these share class projections?