What is Cap Table?

A capitalization table, or "cap table," is a comprehensive record of a company's ownership structure. It provides a detailed breakdown of all the company's securities, including common shares, preferred shares, warrants, and stock options, and identifies the individuals or entities that own them—typically founders, employees, advisors, and investors. For a startup, the cap table is one of the most important strategic documents it maintains. It serves as the official ledger of who owns what percentage of the company's value and voting rights. A well-managed cap table tracks not just the current ownership but also the potential impact of future events, such as the exercise of employee stock options or the dilution caused by a new funding round. Mismanaging a cap table—such as by making undocumented equity promises or failing to track vesting schedules—is a top cause of legal disputes and can be a deal-breaker for venture capital investors. Modern startups use professional platforms like Carta or Pulley to manage their cap tables, ensuring a single source of truth, automated calculations for dilution, and a professional interface for all stakeholders to view their holdings and the value of their equity. It also details the "pre-money" and "post-money" valuations after each round of funding.