Free founder finance calculator
A WACC calculator estimates a company's weighted average cost of capital by blending its cost of equity and after-tax cost of debt. Use it to set a hurdle rate for investments, valuations, and funding decisions.
Your weighted cost of capital
9.00%
Every $100 of long-term capital costs about $9.00 per year at these assumptions.
Use the same currency and valuation date for equity and debt.
Current estimated value of owners' equity
Interest-bearing debt at current value
Return required by equity investors
Effective rate paid to lenders
Marginal rate applied to the debt tax shield
Equity weight
60.00%
Equity contribution: 7.20%
Debt weight
40.00%
After-tax debt cost: 4.50%
Total capital
$10,000,000
Equity plus interest-bearing debt
WACC = (60.00% x 12.00%) + (40.00% x 6.00% x (1 - 25.00%)) = 9.00%
Compare the current assumptions with a more leveraged structure and a higher equity risk premium. These scenarios are directional, not financing advice.
9.00%
60.00% equity / 40.00% debt
7.88%
45.00% equity / 55.00% debt
10.20%
60.00% equity / 40.00% debt
A WACC calculator estimates a company's blended cost of capital by weighting the cost of equity and after-tax cost of debt according to their share of total financing.
WACC equals E divided by V times Re, plus D divided by V times Rd times one minus the corporate tax rate. E is equity, D is debt, V is total capital, Re is the cost of equity, and Rd is the cost of debt.
A good WACC is lower than the expected return on a project without understating its risk. The right benchmark varies by industry, company size, leverage, interest rates, and market conditions.
Interest expense is often tax-deductible, so debt's effective cost is lower after the tax shield. The formula multiplies the pre-tax cost of debt by one minus the corporate tax rate.
Use current market values when they are available because WACC is meant to reflect the financing costs investors require today. Book values can be a fallback for private companies when market estimates are unavailable.
Estimate SAFE conversion, ownership, and founder dilution.
Model a fair co-founder equity allocation.
Estimate the investment required to build an app.
Pitch it to the community, collect votes, and turn the strongest ideas into real products with Pitch An App.
Pitch your app idea