Post-money valuation is what a company is worth immediately after it receives a round of investment. The math is simple: post-money equals plus the new cash invested. It's the denominator most investors and founders quote in 2026 when they talk about "valuation."
Say a startup is worth $8M before a round (pre-money) and raises $2M in new money. The post-money valuation is $10M ($8M + $2M). The investor's ownership is the new money divided by the post-money: $2M / $10M = 20%. The founders and earlier shareholders are diluted from 100% to 80% by the same act.
Y Combinator's 2018 redesign of the SAFE switched the default from a pre-money cap to a post-money cap. The post-money convention is unambiguous: an investor with a $5M post-money cap on a $500K SAFE knows they'll own exactly 10% at conversion ($500K / $5M), no matter what other SAFEs convert at the same time. With pre-money caps, multiple converting SAFEs each diluted each other, making it impossible to know your final ownership in advance.
Most term sheets define the post-money valuation as inclusive of the post-round option-pool size. If the investor requires the pool to be 15% post-round and the existing pool is 5%, the 10% top-up effectively comes out of pre-money, diluting founders and earlier shareholders rather than the new investor. This is the "option-pool shuffle." The number on the term sheet is post-money; the dilution math is pre-money. Always ask which.
When founders say "we raised at $10 post," they mean the post-money valuation. When investors quote a cap table, they quote post-money percentages. When you model future , you start from post-money of the most recent round and project forward. Treating "valuation" as ambiguous between pre and post is a classic source of misaligned conversations and bad term-sheet decisions.