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Employee Stock Option (ESOP) Pool Dilution.

Models the exact Founder Equity dilution suffered when carving out standard 10-15% Employee Stock Option pools for hiring key executives before a Series A.

## The Pre-Money ESOP Shuffle

When a VC offers you a Term Sheet for $5M on a $20M Pre-Money valuation, they will demand a 15% Option Pool is created "Pre-Money." Nearly every first-time founder misunderstands the vicious mathematical impact of this standard clause.

### FAQ

**Q: Why does 'Pre-Money' matter so much for ESOP?**
A: If the 15% pool was created *Post-Money*, both the Founder and the VC would take a 15% haircut to make room for employees. By forcing the ESOP to be calculated into the *Pre-Money* phase, the VC ensures they suffer exactly 0.00% dilution. 100% of the stock carved out for the next 4 years of employees is ripped exclusively from the Founder's equity.