PEINVEST
Contractual provisions that protect investors from the dilution of their ownership stake in subsequent financing rounds at lower valuations. Anti-dilution protections adjust the conversion price or issue additional shares to maintain the investor's proportional ownership.
The estimated value of a company immediately before a new round of financing. Pre-money valuation is a critical negotiation point in investment transactions as it directly determines how much equity investors receive for their capital.
The total estimated value of a company immediately after a new round of financing. Post-money valuation equals the pre-money valuation plus the new capital raised, and is used to determine the investor's ownership percentage.