Splitting founder equity is one of the most important — and most awkward — conversations a founding team will ever have. Get it right and you align incentives for the next ten years; get it wrong and you carry resentment into every raise, hire, and exit. This startup equity calculator gives you a fast, defensible number: how much of the company each co-founder owns after reserving a standard employee option pool, and what that stake is worth at your current or planned valuation.
The math is intentionally simple. Most early-stage companies incorporate with 10,000,000 authorized shares, issue common stock to the founders, and carve out an employee option pool (usually 8%–15%) before the first priced round. If you have four founders splitting the remaining equity equally and a 10% option pool, each founder ends up with 22.5% — that is the number this tool is built around. Adjust the sliders and the result card updates instantly.
How to Use
- Enter the Number of Founders — how many co-founders are splitting the common stock equally. The default of four matches the classic Y Combinator-style team.
- Set the Option Pool as a percentage. At incorporation, 10% is the most common reservation; at a priced Seed round, investors often ask for 15%–20% post-money.
- Optionally type your Startup Valuation. This is the post-money valuation you have raised or expect to raise; it converts each founder's percentage into a dollar figure.
- Optionally set Total Common Shares. Most Delaware C-corps start with 10,000,000 authorized shares and issue 1,000,000–6,000,000 to founders; enter the exact number on your cap table to see share counts.
- Read the result card: Equity Per Founder, Value Per Founder, and Shares Per Founder are the headline numbers.
The calculator assumes founders split the non-pool equity equally. If your team has an unequal arrangement (a CEO taking 60%, two others taking 20% each), use this tool for the pool sizing, then allocate the founder bucket by your own agreed weights.
The Founder Equity Formula
The math is one line:
Founder Equity % = (100% − Option Pool %) ÷ Number of Founders
Run it on the default inputs: (100 − 10) ÷ 4 = 22.5% per founder. The option pool takes 10%, the founders split the remaining 90% equally at 22.5% each.
If you set a $1,000,000 post-money valuation, each founder's 22.5% is worth $225,000. Across all four founders that is $900,000, and the 10% pool is reserved for employees worth $100,000 on paper.
If you skip the option pool entirely (0%), four founders each own 25%. At a $1M valuation that is $250,000 per founder — which feels fairer on day one, but will almost certainly be renegotiated downward when your first investor requires a pool.
Why a 10% Option Pool?
Investors expect a pool because they do not want their investment diluted by future hires. A typical Seed-stage plan:
- 8%–10% at incorporation, before any outside money.
- 10%–15% at a priced Seed round, sized on a post-money basis.
- 15%–20% if you have aggressive hiring plans or a large executive search.
Sizing the pool correctly matters because it comes out of the founders' hides, not the investors'. A 10% pool drops four equal founders from 25% to 22.5% each; a 20% pool drops them to 20% each. Slide the pool upward on this page and watch each founder's stake shrink in real time.
Examples
Example 1 — The classic four-founder split. Four co-founders incorporate, reserve a 10% option pool, and assign a $1,000,000 post-money valuation. Each founder receives 22.5% of the company, worth $225,000 on paper. With 1,000,000 total common shares, each founder holds 225,000 shares and the pool holds 100,000 shares.
Example 2 — Zero pool at incorporation. A technical founder is bootstrapping with three advisors and sets the option pool to 0% on day one. Each founder owns 25%. At a $1,000,000 valuation, that is $250,000 per founder. The warning: when the first priced round requires a 10% pool, everyone's stake drops to 22.5% before a single dollar of new money changes the ownership math.
Example 3 — A ten-founder startup at $10M. A team of ten co-founders closes a $10,000,000 post-money Seed with a 20% investor-required pool. The remaining 80% splits ten ways: 8% per founder, worth $800,000 each. On a 5,000,000-share cap table, that is 400,000 shares per founder and a 1,000,000-share option pool.
Example 4 — Solo founder with a 15% pool. One founder keeps control but reserves 15% for early hires. After the pool, the founder owns 85%. At a $2,500,000 valuation, that single stake is worth $2,125,000 — and on a 2,000,000-share cap table, the founder holds 1,700,000 shares against a 300,000-share pool.
FAQ
How do you split equity between founders?
The simplest defensible split is to subtract the option pool (usually 10%) from 100% and divide what remains by the number of co-founders. With four founders and a 10% pool, each founder gets (100 − 10) ÷ 4 = 22.5%. Equal splits work best when all founders commit full-time and contribute comparable value; unequal splits should reflect a clear CEO or a major contribution such as the original idea, funding, or core technology.
What is a typical option pool size at incorporation?
At incorporation, most startups reserve between 8% and 15% of the fully-diluted shares for an employee option pool. Ten percent is the default you will see in Y Combinator-style standard documents. At a priced Seed round, investors often ask for 10%–15% post-money, and Series A pools commonly reach 15%–20%.
Should the option pool come out before or after investor money?
Investors almost always require the pool to be sized post-money, meaning it is carved out of the founders' stake before the new money enters — this protects the new investor from dilution. A 10% post-money pool lowers every founder's percentage by the pool size, while the investor's percentage stays intact.
How much is my founder stock actually worth?
Multiply your ownership percentage by the company's post-money valuation. If you own 22.5% and the company raised at a $1,000,000 post-money valuation, your paper stake is $225,000. This is a paper number only: common stock in a private company cannot be sold easily, and preferred stock held by investors often has a liquidation preference that reduces what common holders receive in an exit.
Do founders get diluted in later rounds?
Yes. A Series A investor typically takes 20%–30% of the company, and that dilution is shared proportionally across founders and the pool. A founder at 22.5% after Seed may be at 15%–18% after Series A, and 10%–14% after Series B. Use this calculator for the incorporation split, then track dilution per round on a dedicated cap-table tool.
What if one founder is part-time?
Equal splits assume every founder is full-time. A part-time or "adviser" founder typically takes 0.5%–2% and receives a four-year vesting schedule rather than a full co-founder allocation. For full-time teams, consider a four-year vesting cliff (one year) so that anyone who leaves early does not keep an outsized stake.
Is 22.5% a normal founder percentage?
Yes. With four founders and a 10% option pool, 22.5% per founder is the standard result. A solo founder might start at 85%–90%, a two-founder team at 45% each, and a three-founder team near 30% each. Anything above 50% for one co-founder in a multi-founder startup usually signals a CEO-weighted structure.
Disclaimer
This startup equity calculator is provided for informational purposes only and does not constitute legal, tax, or investment advice. Ownership percentages are estimates based on the equal-split assumption and the option pool size you enter; actual cap tables, vesting schedules, preferred-stock rights, liquidation preferences, and tax consequences vary by jurisdiction and require review by a startup attorney and a certified public accountant. Dollar figures reflect paper value at the valuation you supply, not the proceeds you would receive in an exit. Always have a qualified lawyer review your cap table and stock purchase agreements before incorporating or issuing equity.