Cap Table (Capitalization Table)
A cap table is a spreadsheet or document that shows the equity ownership structure of a company, including all shareholders, their ownership percentages, and the types of securities they hold.
What Is a Cap Table?
A capitalization table (cap table) details who owns what in a company. It lists every shareholder, their share class, number of shares, ownership percentage, and any dilution from options or convertible instruments.
What a Cap Table Includes
Why Cap Tables Matter
1. Fundraising: Investors review the cap table before investing
2. Equity compensation: Determines how much of the option pool is allocated
3. Exit scenarios: Models who gets paid what in an acquisition or IPO
4. Tax planning: Equity structure affects tax treatment for founders and employees
5. Governance: Voting rights and board seats depend on ownership
Simple Cap Table Example
| Shareholder | Shares | Type | % Ownership |
|---|---|---|---|
| Founder A | 4,000,000 | Common | 40% |
| Founder B | 3,000,000 | Common | 30% |
| Seed Investor | 2,000,000 | Preferred | 20% |
| Option Pool | 1,000,000 | Reserved | 10% |
| Total | 10,000,000 | 100% |
Related Terms
Insolvency is the financial state where a business or individual cannot pay their debts as they come due, or their total liabilities exceed their total assets. It's not the same as being temporarily short on cash — insolvency means there's a structural inability to meet financial obligations. Insolv
A 401(k) is an employer-sponsored retirement savings plan that lets employees contribute a portion of their pre-tax paycheck to investment accounts. Many employers match contributions up to a certain percentage, effectively giving employees free money toward retirement.
A standing order is an automatic, recurring bank transfer that moves a fixed amount of money from your account to another account on a regular schedule. You set it up once, and the bank automatically processes the transfer — weekly, monthly, quarterly, or annually — until you cancel it. Standing ord
In lending, principal is the original amount of money you borrow — before any interest is added. When you make loan payments, part goes toward reducing the principal and part goes toward interest. The faster you pay down the principal, the less total interest you'll pay over the life of the loan.