Cap Table Management

Cap Table 101: A Founder’s Checklist

Your cap table is the single source of truth for your company’s ownership. Don’t mess it up.

• Start on Day One: Create a simple spreadsheet the day you incorporate. Don’t wait.
• Document Everything: Every share, every option, every promise of equity must be in writing and legally sound. No “handshake deals.”
• Track Vesting: Keep a clear record of employee option grants and their vesting schedules.
• Use Software: Once you have employees or investors, ditch the spreadsheet. Use dedicated software like Carta or Pulley to prevent errors.
• Model the Future: Before you raise money, model how the new investment will dilute everyone’s ownership. Know the impact before you sign the term sheet.
• Hire a Good Lawyer: Don’t try to manage equity on your own. Legal mistakes are expensive to fix.

Your Goal: A cap table that is always accurate, up-to-date, and simple enough for an investor to understand in 5 minutes. A clean cap table builds trust.