Startup down round · Preferred stock

Anti-Dilution Calculator

Compare no protection, broad-based weighted-average protection and a full-ratchet adjustment after a lower-priced financing.

Existing security and down round

CurrencyCurrent conversion priceProtected preferred sharesFully diluted shares before roundDown-round share priceNew round investment

Adjustment comparison

New shares issued—

Down-round price discount—

Weighted-average conversion price—

Full-ratchet conversion price—

Weighted-average conversion ratio—

Full-ratchet conversion ratio—

Weighted-average extra shares—

Full-ratchet extra shares—

Ownership with no protection—

Weighted-average ownership—

Full-ratchet ownership—

Weighted protection gain—

How the adjustment is estimated

The broad-based weighted-average formula is CP2 = CP1 × (A + B) ÷ (A + C). A is the pre-round fully diluted share count, B is the number of shares the new money would buy at the old conversion price, and C is the actual number of new shares. Full ratchet resets the conversion price to the lower new issue price.

The NVCA model legal documents provide industry model venture-financing terms. Exact definitions of fully diluted capitalization, excluded issuances, security classes and adjustment mechanics can change the result. Use signed documents and qualified counsel; this calculator is educational, not legal or investment advice.