A pre-money number is meaningless without the option pool

The record

Two documents show how a valuation headline is actually built. The NVCA model legal document set, most recently revised across 2025 and 2026, is the industry's standard packet for a priced venture round: a certificate of incorporation, a stock purchase agreement and an investors' rights agreement, among others. Separately, Y Combinator's SAFE documentation states that YC standardized on the post-money SAFE in 2018 specifically to make the valuation cap unambiguous. Both describe the same mechanic from different sides of the table: a company sets a valuation, and the number on a term sheet is only complete once the option pool is placed inside it.

What the sources establish

Cooley GO's glossary defines pre-money valuation as the company's value before new money arrives, with pre-money plus the investment equaling post-money. YC's documentation adds the detail that changes the math for founders: on a post-money SAFE, the cap is post the options and option pool that already exist, but it is not post any new or increased pool adopted as part of the financing. A company that sizes up its pool to close a round is funding that pool out of the pre-money side of the ledger, which dilutes founders and earlier holders rather than the incoming investor. Carta's tracked data puts the median pool at about 9% of equity at pre-seed, rising toward 19% by Series D, with a wide spread between companies at every stage.

Scope and revision

Neither the NVCA set nor the YC documentation states a universal pool size; both describe a negotiated mechanism, not a fixed rule. The NVCA documents carry different revision dates depending on which document is in use, so a reader comparing a live term sheet against the model set should check which vintage produced it. Carta's option-pool figures describe the platform's own cap-table population as of its publication date, not a market-wide census, and the spread between the 25th and 75th percentile at each stage is wide enough that a single median is a starting point, not a target.

The decision in front of you

This is editorial, not legal advice: before agreeing to a headline valuation, a founder can ask whether the option pool is being created or topped up as part of the round, and confirm whether the stated pre-money figure already nets that pool out. The arithmetic is simple once the inputs are named, but a term sheet rarely spells it out in those words.

• Does the term sheet's pre-money figure already include a newly sized option pool?
• What percentage of fully diluted shares does the pool represent after the round closes?
• Is the pool sized to the company's actual hiring plan, or to a round-number convention?

A valuation headline is a single number standing in for several negotiated inputs. The model documents and the SAFE mechanics agree on where the option pool sits in that arithmetic; whether a given round follows the convention is a question for the term sheet, not the press release.