A simple tool to help you with Cap Tables and Exit Scenarios
A few days ago on my way to New York I met a serial entrepreneur whom I respect and like a lot. He consulted with me regarding a round he was working on with several funds. We discussed the different funding options available to him. I quickly realized that from his perspective it was not clear what the impact of each scenario would be on the cap table of his company and I wondered how he was planning to handle the negotiations. The meeting ended up with me offering to prepare a template cap table for him. 3 hours later, I looked with despair at the draft cap table and realized sadly that it was more complicated than I had assumed. Building something which is generic, simple and and that covers all major financing instruments is actually very difficult!
I have no idea if he ended up using it, but as I progressed with the template I began thinking of the thousands of entrepreneurs that I’ve met that would love to have a tool like this.
This template will take you from a company’s first funding to round C, but you can easily add more rounds. One caveat however, if you have already raised multiple rounds, I suspect my template is way too simplistic for you.
Also, I assumed that only at the seed and A rounds companies will have SAFE or bridge loans. No need to tell me it’s not true, I really tried to simplify the cap table.
There are also no warrants or anti-dilution protections. In short, this template was not designed to replace your CFO/attorneys, but simply to help you assess possible future scenarios.
There is also a tab with a simplistic exit distribution analysis. But be aware that I left out many things to enable a quick calculation.
Have fun playing with it, and if you find a mistake please let us know, and we will fix it.
I hope this cap table and exit analysis will help many entrepreneurs, please send it to others as well.
There are a few startups that manage cap tables — eShares, TrueEquity and others. I highly recommend trying them as well.
To use the Cap Table, select the link below and select Open with Google Sheets then select File and Make a Copy. From there you can edit your own Cap Table.