A Pre-Money Valuation is a company’s agreed valuation immediately before new investment capital is added in a financing round, and it is used to determine the price per share and investor ownership. In venture deals, Pre-Money Valuation is negotiated alongside option pool sizing and other terms, and small changes in Pre-Money Valuation can materially affect dilution outcomes.
Ryan Roberts is a startup lawyer with more than two decades of experience advising on venture financings and M&A transactions totaling more than $1 billion. He is the author of the Amazon bestselling startup law book Acceleration.
