- 1 How do you make a capitalization table?
- 2 What is a cap table example?
- 3 How do you calculate valuation cap?
- 4 How do you manage a cap table?
- 5 Do public companies have cap tables?
- 6 What is a pro forma capitalization table?
- 7 What is a fully diluted cap table?
- 8 What is a cap table Carta?
- 9 What is a clean cap table?
- 10 What does a valuation cap mean?
- 11 Is a higher or lower valuation cap better?
- 12 What is a capped note?
- 13 What is an outstanding stock?
- 14 What is a safe venture capital?
- 15 How do you value a startup?
How do you make a capitalization table?
How to Make a Cap Table
- Authorized shares: Number of shares the company is allowed to issue.
- Outstanding shares: Number of shares held by all shareholders in the company.
- Unissued Shares: Number of shares that have not been issued.
- Shares reserved for stock option plan: Unissued shares reserved for future hires.
What is a cap table example?
The capitalization table shows each investors’ equity capital stake in the business, which is calculated by multiplying the share price by the number of shares owned. For example, startups run several funding rounds to support capital needs. They also issue stock options to attract talent.
How do you calculate valuation cap?
How to determine your valuation cap
- the amount you’re raising on the convertible note (say $500k),
- the conversion discount of the note (say 20%),
- the pre-money valuation cap of the note (say $4m),
- the percentage of your company which the VCs will take in your Series A (say 30%),
How do you manage a cap table?
6 considerations for managing your cap table
- For better business intelligence, look to your cap table.
- Familiarize yourself with its basic elements and formats.
- Recognize the importance of executive alignment.
- Evaluate and implement tools to help you manage it.
- Determine and delegate ownership of the cap table.
- Decide how much information to share with investors.
Do public companies have cap tables?
Public companies primarily use transfer agents and a wide array of technologies and systems to keep track of their stakeholder information and therefore it is uncommon for public companies to refer to their stakeholder records and accounting as a “cap table“.
What is a pro forma capitalization table?
A pro–forma capitalization table is a spreadsheet that reflects the capitalization structure of a company today as well as immediately following a potential investment (i.e. on a “pro forma” basis).
What is a fully diluted cap table?
Fully–diluted cap table is a version of the cap table that shows the total number of currently outstanding shares for each security, as well as the totals from each convertible security if those were to be exercised.
What is a cap table Carta?
A capitalization table (or “cap table”) is a list of all the securities your company has issued and who owns them. Securities include stock, convertible notes, warrants, and equity grants.
What is a clean cap table?
A clean cap table means that it is up-to-date for the latest transactions, accurately reflects company ownership, and shows options available to employees or capital providers. All this information needs to be quickly assessed to understand shares authorized, issued, and outstanding.
What does a valuation cap mean?
The Valuation Cap is the most important term of a convertible note or a SAFE. It entitles investors to equity priced at the lower of the valuation cap or the pre-money valuation in the subsequent financing. The valuation cap sets the maximum price that your convertible security will convert into equity.
Is a higher or lower valuation cap better?
From an investor’s perspective, higher valuations reflect more expensive investments since investors must pay more for the same level of ownership. By investing at a lower valuation, convertible debtholders receive equity ownership at a cheaper rate than the current valuation.
What is a capped note?
A capped note means there is a maximum valuation at which the note will convert. A typical cap on a seed round note is $10 million. This is fair, as is $5, $8 or $20, incidentally, depending on the group and what they are doing.
What is an outstanding stock?
Shares outstanding refer to a company’s stock currently held by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders. A company’s number of outstanding shares is not static and may fluctuate wildly over time.
What is a safe venture capital?
A SAFE is an agreement to provide you a future equity stake based on the amount you invested if—and only if—a triggering event occurs, such as an additional round of financing or the sale of the company.
How do you value a startup?
Important Factors for Pre-Revenue Startup Valuation
- Number of Users – Proving you already have customers is essential.
- Effectiveness of Marketing – If you can show you can attract high-value customers for a relatively low acquisition cost, you will also attract the attention of pre-revenue investors.