Pre-Money Valuation
What your company is judged to be worth right before a new round of investment is added on top of it.
Quick Answer
Why does pre-money valuation matter more than the amount I'm raising?
Because dilution is driven by the ratio of new investment to post-money value — a higher pre-money valuation for the identical raise amount always results in less dilution for existing shareholders, not more capital raised.
- Dilution depends on the ratio, not the raise amount alone
- The same raise at different pre-money valuations dilutes differently
- Negotiate pre-money valuation as carefully as the check size
The Lovie Advantage
Lovie shows the dilution impact of any pre-money figure against your live cap table before a term sheet is finalized.
See how this connects to Term Sheet. For the formal definition, see Investor.gov's glossary entry on asset allocation.
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