ESOP calculator: Size Your Option Pool and Dilution
The ESOP calculator below turns your hiring plan into three numbers every founder needs before a round closes: a recommended option pool size, per-hire equity ranges and the dilution impact on founders and existing shareholders.
Pool size is not a guess. It is the price of the team you must build before the next round, expressed as a percentage of fully diluted capital. In Gulf pre-seed rounds a 10-15% pool is the working norm, and term sheets will demand it sits inside your pre-money valuation. This tool runs that maths so you enter the negotiation with numbers, not opinions. If you are still shaping the round, our pre-seed pitch deck guide covers the wider picture.
How the ESOP calculator works
Enter your pre-money valuation, round size, total planned hires before the next round, and how those hires split between executive, lead and individual-contributor levels. The calculator weights each level with typical Gulf grant ranges, derives a recommended pool, then applies it to your cap table. Because the pool is created inside the pre-money valuation, the incoming investor’s percentage is fixed first and founders absorb the rest; the tool shows both before-round and after-round dilution scenarios so you can see exactly who carries the pool.
ESOP pool planner
Who should use this ESOP calculator
Use this ESOP calculator if you are raising a pre-seed or seed round in Bahrain, Saudi Arabia or the UAE, or advising founders who are. Check whether your planned pool sits inside the 10-15% band: below 8-10% reads as under-provisioned for the hiring plan, and above 15-20% signals over-generous grants. The per-hire ranges are guides for individual grants, not promises, and every grant should vest over four years with a one-year cliff. Read the result alongside our cap table guide and SAFE vs convertible note explainer to see how the pool interacts with the instruments you are raising on.
ESOP calculator methodology and GCC benchmarks
Recommendations come from a weighted model: 1-2% per executive hire (midpoint 1.5%), 0.5-1% per lead (0.75%) and 0.1-0.5% per individual contributor (0.25%), clamped to a 10-15% typical band for pre-seed plans of up to ten hires. The dilution maths uses the standard convention that the pool is expressed as a percentage of fully diluted post-money capital. Valuation, vesting and option mechanics follow the employee share scheme practice documented by HM Revenue and Customs and mirrored in DIFC, ADGM and Bahrain structures. Bahraini founders can benchmark hiring and payroll support against Tamkeen programmes. Figures are indicative: grant size depends on role, timing and cash package, and this tool is not legal, tax or investment advice. For the cash side of an offer, our runway maths guide shows what the payroll actually costs.
Frequently asked questions
What is a typical ESOP pool size for a Gulf pre-seed startup?
Ten to fifteen per cent of fully diluted post-money capital, sized from the hiring plan. Two to three hires usually justify 10-12%, and four or more, or any VP-level appointment, push toward 15%. Pools above 20% read as heavy at this stage.
How much equity should my first CTO or lead hire receive?
Guidance ranges are 1-2% for an executive hire such as a CTO, 0.5-1% for a lead and 0.1-0.5% for an individual contributor, vesting over four years with a one-year cliff. The actual grant depends on cash salary, timing and how critical the hire is to the round.
Does the option pool dilute founders or investors?
Created before the round, the pool sits inside the pre-money valuation, so it dilutes founders and existing shareholders rather than the incoming investor. Created after the round, it dilutes everyone pro-rata, including the new investor, which is why term sheets require the pool before closing.
Should I create the ESOP pool before or after my funding round?
Before. Investors price the pre-money assuming the pool exists, so creating it early costs founders the same dilution while keeping the investor stake fixed and the cap table investable. After-round pools need investor consent, which is rarely given at pre-seed.
Questions on your specific cap table? Contact the Valu.vc team and we will run the numbers with you.