Pre-Money Valuation

Also called Pre-Money

A company's valuation just before an investment goes in. Add the new money and you get the post-money valuation.

Why it matters

Pre-money is the number founders and investors actually negotiate, because it sets how much of the company the new money buys. A small change in it can mean a real change in your ownership.

For example

The founders and the lead negotiate a 20 crore pre-money valuation; add the 5 crore being raised and the company is worth 25 crore right after.

Related terms

Post-Money Valuation Dilution Priced Round

Go deeper

See how founders actually handle this on Raising your first round, part of the Starting Up hub.

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