pro cap table training course

CAP TABLE #12: The Common sheet of the cap table

This is the 11th part of the Pro Cap Table training course on the common cap table. In this series we go through the basics you need to know, then work sheet by sheet so you know how to make a seriously kick ass cap table.

There are 14 parts:

  1. What is a cap table and other important questions
  2. Cap table dilution step by step example
  3. Cap table dilution math
  4. Starting the cap table (The drop down menus we need)
  5. Shareholders sheet
  6. Deal calculations
  7. The cap table sheet
  8. The assumptions sheet
  9. Individual shareholder returns sheet
  10. Returns waterfall calculation
  11. The ESOP sheet
  12. The Common sheet
  13. The convertible notes and warrants sheet
  14. The preference shares sheets (From Series A to I)

You can join the course and get these sent straight to your mail box here:

 

Today we are dealing with common shares in the common cap table sheet.

Founders will get common shares starting out and sometimes your first staff (if you don’t give them options?). Maybe you might give some to early and senior staff as RS (Restricted Shares).

Input the name in the dropdown. Add the Issue date. You can then add their Cert No. which is the certificate number. Lawyers will do this. I’ve formatted this for you so you only need to write 1, 2, 3, 4 etc.

You can add more people by inserting rows above the total shares bit.

If the shares set them as RS, otherwise set them as Other.

Input how many shares they have. This should match up with the Founder Shares that you input in the Assumptions sheet!

The Shares Outstanding will be the same unless there was a disposition.

“Disposition” means to get rid of shares by selling, assigning or transferring to another person or entity. Therefore, “disposition of shares” means to dispose of or sell your shares.

Basically, you do something with the shares like sell them or transfer them to a new person and you want to then decrease the shares of someone.

Say Niklas wants to sell 10,000 shares. Input the date and the reason, then add 10,000 to the No. Shares and the formulas will deduct 10,000 shares from Niklas. you can use the sheet to record every transaction that happens. You don’t just list the person once and do everything in one row. Add a line every time something happens. We’re getting pretty advanced now, and I’m not teaching you to be a startup lawyer…

The basis of issuance is a drop down which has the following options:

  • Original issuance – you get new shares
  • Restricted stock from ESOP – you move the RS from the ESOP to the common ledger
  • Options exercise – options turn from options in the ESOP sheet to actual shares in the common sheet
  • Share transfer – you take shares from someone (like Niklas) and give them to someone else
  • Balance after repurchase – you sell stuff, do some calculations and end up with a new share cert which is what is left (this is more complicated)

The last thing you add is the price per share. That is typically the price of the last round, or 409a if you are in America.

The checks at the bottom make sure things add up correctly with the ESOP sheet

Here is where you add the disposition date and the reason.

The bits under RS vesting are FYI for RS which come from the ESOP sheet.

Add comments whenever you do something!

You’re now done with the common cap table!

Click here to continue

The convertible notes and warrants sheet

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