The investor’s field guide · P
Post-money valuation
The equity value of a company immediately after new investment, under the assumptions of the funding agreement.
Explained by the editorial team
Post-money valuation is usually described as pre-money valuation plus new primary equity investment. That simple relationship is useful for a straightforward priced round. It needs care when transactions include secondary share sales, convertible instruments or other adjustments.
A worked example
With a £3 million pre-money valuation and £1 million invested into the company, the simple post-money value is £4 million. The new money represents 25% of that total. If an investor instead buys existing shares from a shareholder, that money does not automatically enter the company.
What to examine
Confirm how the price per share was calculated and which securities are included. A post-money SAFE uses its own contractual mechanics; its valuation cap should not be treated as identical to a priced-round valuation. Percentage ownership also says nothing by itself about rights on a sale. Use a fully explained cap table to connect the headline figure to the actual securities being purchased.
General information, not investment, legal or tax advice. Examples are illustrative. Read the disclaimer.