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.

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

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.

In both priced rounds and SAFEs, the formula for calculating post-money valuation is pre-money valuation plus the amount raised.

Most companies will raise money first on SAFEs or other convertible instruments, which can complicate understanding how much of the company has been sold.

Founders should be cautious about how much they raise on SAFEs, as it dilutes their ownership in the company.

It's crucial for founders to keep track of how much equity they've sold through SAFEs, as this affects their ownership percentage and future fundraising.

Don't over-optimize for valuation caps when raising money on SAFEs, as the difference in ownership percentages may not be significant, and the focus should be on making the company successful instead.

Understanding the mechanics of dilution and cap tables is essential for founders to navigate the fundraising process effectively. I hope this will not be anything new to you as we discuss raising money on post-money SAFEs and what happens as you hire people and issue equity to employees.