Cap Table

A cap table (capitalisation table) shows a company’s ownership structure. It shows who holds how many shares, in which class and what percentage of the company they represent. It is the key document for calculating funding rounds and for information given to investors.

What It Shows

• Shareholders and the number, par value and class of their shares (including preferred share classes),
• Granted and ungranted options and the option pool,
• Instruments that will convert into shares, such as a SAFE or convertible note,
• Vesting status, that is, vested and unvested shares,
• The share price paid and amount invested in each funding round.

Current and Fully Diluted Views

A cap table is usually prepared in two views. The current view shows only issued shares. The fully diluted view is calculated on the assumption that all options are exercised and all convertible instruments convert. Pre-money valuation and share price are mostly calculated on the fully diluted view.

Funding Round Modelling

Before a round, the combined effect of the new investment, the option pool expansion and SAFE conversions should be modelled in the cap table. Valuation cap, conversion discount and anti-dilution protection provisions can reduce the founders’ remaining stake more than expected.

Relationship with the Share Register

A cap table is not a legal record. Share ownership is recorded in the share register in a joint stock company (TCC Art. 499), the share register in a limited liability company (TCC Art. 594) and the trade registry. In due diligence, investors compare the cap table with the share register, general assembly resolutions and registration announcements. Inconsistencies between records are among the main issues to fix before closing.