Cap Table Model

Description
Apart from recording transactions, a cap table also comprises many legal documents such as stock issuances, transfers, cancellations, conversion of debt to equity, and other documents. The executives must manage all these transactions and documents accurately to show the events since the company’s inception. The simplest form of cap tables lists the shareholders at the beginning and their respective share ownership. Cab tables are used by venture capitalists, entrepreneurs, and investment analysts to analyze important events such as ownership dilution, employee stock options, and the issue of new securities.
How to Make a Cap Table
Most companies use spreadsheets to create a cap table at the inception of the business. The cap table should be designed in a simple and organized layout that clearly shows who owns certain shares and the number of outstanding shares. The most common structure is to list the name of investors/security owners on the Y-axis, while the type of securities is listed on the X-axis.
Alternatively, a company can use a spreadsheet template that allows for the addition of information and figures related to their business. The first row should indicate the total number of shares of the company. The subsequent rows should list the following:
Authorized shares: Number of shares the company is allowed to issue.
Outstanding shares: Number of shares held by all shareholders in the company.
Unissued Shares: Number of shares that have not been issued.
Shares reserved for stock option plan: Unissued shares reserved for future hires.
A separate table in the capitalization table should include the following:
Names of shareholders: The names of shareholders who have bought shares in the company.
Shares owned by each shareholder: The number of shares held by each shareholder.
Stock options: Stock options are owned by each shareholder.
Fully diluted shares: Total number of outstanding shares (helps shareholders determine the value of their shares).
Options remaining: Number of remaining shares available to be optioned.