A record showing the ownership of a company across founders, investors, employees and other shareholders.
A Capitalization Table (Cap Table) is a formal ledger detailing an entity's equity ownership structure, including share classes, option allocations, convertible debt, and pro-rata voting rights.
A master spreadsheet that shows exactly who owns what percentage of the company, how much they paid for it, and what claims they have when the company is sold.
Looking at a company not just as a business, but as 10,000,000 total shares divided among founders, seed angels, venture funds, and the employee stock option pool.
Founder A: 4,000,000 shares (40%). Founder B: 3,000,000 shares (30%). Seed Investor: 1,500,000 shares (15%). ESOP Pool: 1,500,000 shares (15%). Total Fully Diluted Shares = 10,000,000 (100%).
Messy cap tables with dozens of inactive early advisors, undocumented promissory notes, or unrecorded promises to former colleagues can delay or terminate institutional funding rounds.
Before accepting convertible notes or expanding employee stock option pools, model the exact downstream impact on the cap table to prevent founders losing operational control.