Cap Table
A cap table is the master record of who owns how much of a company, listing every class of stock and who holds it. The fully diluted version includes outstanding shares plus options, warrants, and convertible securities — it's the only denominator that gives you your true ownership percentage. Always ask for the fully diluted cap table before accepting an equity offer.
Cap Tables in Plain English
A cap table is the master record of who owns how much of a company. It lists:
- Every class of stock (common, preferred, options, warrants, convertibles)
- Who holds each type
- How many shares they hold
- What they paid (or the price implied by their grant)
When you’re evaluating a startup offer, the cap table (especially the fully diluted version) is what tells you what your equity is actually worth as a percentage of the company.
Fully Diluted vs. Outstanding
- Outstanding shares: What’s currently issued and held by people today.
- Fully diluted shares: Outstanding shares plus everything that could turn into shares:
- Option pool (granted + ungranted options)
- Warrants
- Convertible notes / SAFEs (modeled as if they converted)
Your real ownership is:
Your shares ÷ Fully diluted shares
If you only look at outstanding shares, your percentage will look higher than it really is once all the promises (options, notes, etc.) are honored.
Simple Early-Stage Pattern
At very early stages, a typical cap table might look like:
- Founders: 80–90%
- Option pool: 10–15%
- Investors: the rest (if any)
As the company raises more rounds (Seed, Series A, B, etc.), things get more complex:
- Multiple preferred share classes (Seed Preferred, Series A, Series B…)
- Warrants
- Convertible notes / SAFEs
- Side letters with special rights
All of these must be included in the fully diluted cap table.