Navigation
by Undo Capital
February 12, 2026
Text Link

What Is Option Pool Shuffle (Pre-Round Expansion)?

An option pool shuffle is the expansion of a company’s option pool before a funding round, which effectively shifts dilution onto founders rather than new investors.

Option Pool Shuffle (Pre-Round Expansion) Meaning

The option pool shuffle, meaning it centres on how dilution is allocated before an investment closes. To define option pool shuffle in practice, investors often require the company to increase its option pool ahead of the round to ensure enough equity is reserved for future hires. Because this expansion happens pre-money, the dilution is absorbed mainly by existing shareholders, typically the founders. A clear option pool shuffle definition is critical in negotiations, as it directly affects founder ownership even if the headline valuation appears unchanged.

‍

Disclosure Notice: This communication is issued by Undo Capital Limited (“Undo Capital”) and is provided strictly for informational purposes only. It contains general information and should not be relied upon as accounting, business, financial, investment, legal, tax, or other professional advice. Undo Capital is not regulated by the Financial Conduct Authority (FCA) and does not provide investment, financial, or tax advice. Our services are designed to assist startups and businesses with company formation, legal agreements, and funding-related documentation. Nothing in this communication constitutes, or should be construed as, a recommendation, offer, or solicitation to purchase or sell any security or financial instrument.
‍
Participation in startups and early-stage enterprises involves significant risk. Such investments may be illiquid, may not generate dividends, may be subject to dilution, and may result in the total loss of invested capital. Any decisions or actions that may affect your business or personal interests should be taken only after seeking advice from suitably qualified professional advisors, and should form part of a balanced and diversified portfolio. This communication may contain links to third-party websites. The inclusion of such links does not imply endorsement, approval, investigation, or verification by Undo Capital. We accept no responsibility or liability for the content, accuracy, or use of information contained on any third-party websites. © 2025 Undo Capital Limited. All rights reserved. Reproduction is strictly prohibited.

Undo Capital handles everything — SEIS/EIS, investor agreements, share issue, and filings — in one simple, automated platform.

Product
About us
Resources
Disclaimer: Our services are designed to assist startups and businesses with company formation, legal agreements, and funding-related documentation. We do not provide investment advice, financial advice, or tax advice, nor are we regulated by the Financial Conduct Authority (FCA). Participating in startups and early-stage enterprises carries inherent risks, including limited liquidity, absence of dividends, potential loss of investment, and dilution. Any decisions regarding investments should be made independently by the investor as part of a well-diversified portfolio.