A Startup Cap Table is essentially a spreadsheet, usually used by small start-ups or budding early stage companies, which clearly identifies the ownership structure of the business. The startup cap table helps the management to asses the potential upside and downside risk of investing in the company's business plan. The table basically gives the investors an idea of ownership prior to putting in their money. Often, early investors are wary about putting in more money into a business due to unseen expenses and risks. In order to address these issues, potential investors put together a startup cap table, which basically acts as their charter. The startup cap table helps the company to determine their overall investment capability and breaks down the risks to help make the decision whether or not to continue with the funding.

The startup cap table template is primarily designed to provide a format for an investor to jot down key elements like equity, personal assets and property, business projections, operating costs, cash flow and other important information necessary to determine the level of funding required. They can also use it to compare other businesses that come under similar industries or sectors and to identify key competitors. A key element is the amount of equity that the company has as this will dictate the type of funding they can receive. For most start-ups, it's common for no more than twenty percent equity to be required.

Other vital elements in the startup cap table templates deals with the ownership model, such as CVs, business plans and other documentation outlining the founders' experience and vision for the company's growth. The document is also useful when founders need to provide information regarding their early pay out experiences and various projects they have taken on. This includes a breakdown of the type of investors that were involved in the funding rounds and the impact they had on the company's development. This information is useful for future venture capitalists and angel investors as well as potential employees.

The pre-investment cap table helps entrepreneurs make a convincing presentation to skeptical potential investors. It provides information on the value of shares issued and the price paid for them. In addition, it lists the price range of the company's stock as well as its dividend payments and future payments to capital stock holders. The document also includes a discussion on the founder's potential to increase the share capital, which should be considered carefully due to possible dilution of control. A good entrepreneur needs to carefully consider whether a diluted control position could negatively impact future returns.

When evaluating the startup cap table template, it's crucial to analyze it closely to ensure it accurately reflects all of the essential information needed. One way to do this is to provide an example of the business plan along with a copy of it. The business plan is generally one of the most important parts of a securities filing. The investors will want to see how the business plan was written and why it provides such detail about the company's industry as well as a roadmap for future growth.

A startup cap table template also provides a list of common equity cap tables. These include the STP, IACI, PEGI and NYSE/MS. They all provide different pictures of value for different types of stocks and capitalization situations. A good template will look closely at the definitions in the various documents and select the one that best represents the business opportunity being presented. It should also closely examine the definitions of terms used in accounting and provide a short explanation.

startups should also include a discussion of stock options. Stock options are among the most controversial areas of private investment. The reason for this is that they represent a rare and highly valuable way for early stage companies to raise capital from potential investors.

A good startup cap table will discuss the use of stock options in the context of pre-money valuation and post-money valuation. While most angel investors and venture capitalists use pre-money, some companies may choose to raise a higher capital amount in the post-money stage through stock options. In this case, the cap table should provide a clear description of the risks associated with these shares and should explain what the value of these options are likely to be in the future. Finally, it is crucial that the investors understand what risk and rewards they will be entitled to upon the successful completion of a business.