Do you include unvested options in cap table?

Do you include unvested options in cap table?

Yes, all unvested shares and options are included in the cap table as if fully-vested. It is beneficial to also reflect the vesting schedules in the cap table.

What is included in a cap table?

A capitalization table, also known as a cap table, is a spreadsheet or table that shows the equity capitalization for a company. Cap tables often include all of a company’s equity ownership capital, such as common equity shares, preferred equity shares, warrants, and convertible equity.

How do you fill out a capitalization table?

How to Make a Cap Table

  1. Authorized shares: Number of shares the company is allowed to issue.
  2. Outstanding shares: Number of shares held by all shareholders in the company.
  3. Unissued Shares: Number of shares that have not been issued.
  4. Shares reserved for stock option plan: Unissued shares reserved for future hires.
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What is the difference between common shares and preferred shares?

The main difference between preferred and common stock is that preferred stock gives no voting rights to shareholders while common stock does. Preferred shareholders have priority over a company’s income, meaning they are paid dividends before common shareholders.

Who can see the cap table?

There’s no legal requirement to share your cap table with employees, however companies typically give senior management (e.g. CFO, COO, CTO) visibility. If your employees have a stake in the business through shares or options, it makes sense to give them a degree of cap table visibility.

Are Cap tables confidential?

Because the cap table provides a clear picture of a company’s worth, it’s vital for the table to be accurate at all times. With so many people having access to the cap table, it poses a security risk for highly confidential business information.

What should a startup cap table look like?

In summary, that’s what a cap table represents – it is a table illustrating the capitalization of the company. They should include all elements of company stakeholders such as convertible debt, stock options and warrants in addition to common and preferred stock.

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Why are stock options included in the cap table?

Although stock options are not the same as shares, only the right to purchase shares, they can be included in the cap table to show the impact on the percentage shareholdings on the basis that all options are eventually exercised and converted into shares.

Is there a cap table for vested shares?

A cap table can and should show everything about both vested and unvested shares and option grants. There is a fairly robust SaaS offering that handles this well .

What is a cap table and how is it displayed?

Cap tables are always shown “as fully diluted”, which means that they include *everything* that anyone is entitled to own, under *any* scenario. Because ‘unvested shares’ are backed up by options that have been authorized, the Option Pool is typically shown as its own category, with the individual grants listed separately.

What equity issuances should be included in my cap table?

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Your cap table should only include equity issuances that have been properly issued and documented by the requisite parties (for more on the requirements for equity issuances, see our article ).