How to use the convertible note calculator
Prepare the values for this calculation
Model a simplified cap/discount conversion into equity using user-entered financing assumptions. Use the formula below to check that it answers your question. Read the input units before transferring figures from a statement, measurement or dataset.
Enter and check each input
- Investment amount: enter a value at least 1e-06. Use the unit named in the label or selected above. Do not leave this required field blank.
- Next-round price per share: enter a value at least 1e-06. Use the unit named in the label or selected above. Do not leave this required field blank.
- Conversion discount (%): enter a value at least 0 and no more than 100. Use the unit named in the label or selected above. Do not leave this required field blank.
- Valuation cap: enter a value at least 1e-06. Use the unit named in the label or selected above. Do not leave this required field blank.
- Next-round pre-money valuation: enter a value at least 1e-06. Use the unit named in the label or selected above. Do not leave this required field blank.
- Pre-financing shares: enter a value at least 1e-06. Use the unit named in the label or selected above. Do not leave this required field blank.
The input table gives a complete example. Keep units and time periods consistent across related fields.
Calculate and resolve any input error
Choose Calculate after entering the values. Changes also update the answer after a short pause. If an error appears, follow its message, correct the field and calculate again. Reset restores the example values.
Interpret the answer
Check Estimated conversion shares first. With the unchanged example inputs, it is 62,500. Compare the additional metrics with the primary result; each has its own label and unit.
Compare and keep a useful result
For a controlled comparison, keep every other example input unchanged and change Investment amount from 100000 to 110000. The resulting Estimated conversion shares is 68,750. This illustrates the equation’s response to that input, rather than a forecast of real events.
Read the chart’s axis labels and data table. A scenario curve changes one stated input while holding the others fixed; it does not add external observations. Use Download graph to save an available chart as a PNG.
Use Copy result or Download CSV to keep the answer. Share tool shares the page address without placing your input values in the URL. Recheck inputs and assumptions before using the result for a decision.
Convertible Note Calculator formula
Conversion price is the minimum of round price, discounted round price, and cap-implied price; shares=investment/conversion price.
Inputs and units
| Input | Format / range | Example |
|---|---|---|
| Investment amount | minimum 1e-06 | 100000 |
| Next-round price per share | minimum 1e-06 | 2 |
| Conversion discount (%) | minimum 0; maximum 100 | 20 |
| Valuation cap | minimum 1e-06 | 8000000 |
| Next-round pre-money valuation | minimum 1e-06 | 10000000 |
| Pre-financing shares | minimum 1e-06 | 5000000 |
Worked example
Using the example inputs above, the estimated conversion shares is 62,500.
- Estimated conversion shares
- 62,500
- Conversion price
- $1.60
- Discount price
- $1.60
- Cap-implied price
- $1.60
Results and assumptions
Simplified cap/discount conversion model; legal note terms can differ materially.
Fix an input or unexpected result
Investment amount is required. Enter investment amount using the format and bounds in the input table. Zero and an empty field are different: use zero only if it is allowed and represents your data.
If your answer differs from the example, choose Reset and compare every field, including selected units and options. Check percentage versus decimal entry and whether values describe the same period. Round only the final displayed answer when reproducing the formula.
If a discrepancy remains, report the calculator issue with the page address, non-sensitive example inputs, actual result, expected result and a reference for your calculation.