Cap Tables Explained: Essential Investment Structuring

Understand what a cap table is and how it tracks ownership stakes in a company. You’ll gain a clear understanding of how cap tables function in startup financing.

Explore the key components of a cap table, including founder shares, investor shares. You’ll be able to identify the different elements that make up a typical cap table across at least one funding round.

Discover how cap tables evolve as a company raises funding through multiple rounds. You’ll learn how funding rounds affect ownership stakes and what to watch out for as a founder or investor. Pro Tip: You'll also learn how to do a share-split which reduces the share price to a more manageable number.

Learn what dilution is and how it impacts equity ownership in a startup. You’ll understand the basics of dilution and its effect on founders, employees, and investors during funding rounds.

Explore how dilution occurs at different funding stages and its impact on early investors and founders. You’ll understand the mechanics of dilution throughout the life of a company.

Note: With Options, the post-money valuation calculation changes to: Shares in issue x PPS (not just pre-money valuation + raise amount).

Learn how to use option pools to manage dilution. You’ll discover strategies to help founders retain enough ownership while still offering equity to attract talent.

Learn how to update cap tables as new funding rounds or employee equity grants occur. You’ll be able to maintain accurate ownership records.

Explore how to communicate cap table changes with investors and manage their expectations as new stakeholders come on board.

Discover how cap tables change during an acquisition, and what founders and investors can expect in terms of ownership and payout.

Learn what steps need to be taken to prepare the cap table for an acquisition, ensuring all equity stakes are accurately represented and how the payout will be distributed.

We’ll recap the key points of the course and motivate you to apply what you’ve learned to your next funding round or investment deal. By the end, you’ll feel ready to put these cap table skills to use. The official Tippy Top Cap Table Template is available in the downloadable materials.