When raising money on SAFEs, the investor's ownership is calculated by dividing their investment amount by the post-money valuation or valuation cap.

In a priced round, the SAFE converts into shares based on the pre-money valuation, which includes the increased options pool.

When raising funds, it's advisable to use post-money SAFEs to simplify calculations and better track future dilution, even if pre-money SAFEs have been used in the past.

The post-money valuation is calculated by adding the pre-money valuation to the total amount raised, which determines the ownership percentages for new investors.

The introduction of post-money SAFEs simplifies understanding dilution by clarifying how much of the company founders have sold to investors after all SAFEs have converted.

The SAFE investor's shares are calculated based on the conversion price, which is determined by the valuation cap if it's lower than the priced round valuation.

While priced rounds are still a common method for raising funds, they typically occur later in a startup's lifecycle, often after initial fundraising through SAFEs or convertible notes.

In a priced round, the SAFEs convert into shares, and the option pool is often increased to accommodate new hires, which can dilute existing shareholders.

It's crucial for founders to understand their dilution when raising money through SAFEs or convertible notes, as they may end up owning significantly less of the company than expected after a priced round.