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RESEARCH & PRACTICAL GUIDES

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Worked examples for understanding startup valuation, dilution, cash burn and runway.

01

GUIDE · 6 MIN READ

How Startup Valuation and Dilution Work in a Priced Round

In a simple priced startup round, post-money valuation equals pre-money valuation plus new primary investment. A new investor's ownership is their investment divided by the post-money valuation. That shortcut works only when the share-count assumptions are consistent and additional securities or option-pool changes do not alter the calculation.

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02

GUIDE · 6 MIN READ

How Investors Can Calculate Startup Burn Rate and Runway

Startup runway estimates how long available cash can support a company at its current net cash burn. Divide usable cash by monthly net burn for a basic estimate. Then test planned spending, collection delays and financing assumptions, because a historical average can hide a cash shortage before the next milestone.

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