Cap table hygiene 101
The habits that keep a register trustworthy, and the errors diligence always finds.
6 min read
One source of truth
The moment two versions of the cap table exist, one of them is wrong. Every stakeholder question, every model, and every diligence request should read from the same live register, with the spreadsheet exports clearly downstream of it.
Paper behind every number
Each row on the register should trace to a signed instrument and, where required, the approval that authorised it. Diligence is fundamentally an audit of this chain; companies that maintain it close rounds weeks faster.
Fully diluted or nothing
Quote ownership fully diluted: issued shares plus the pool plus everything convertible. As-issued percentages flatter everyone and mislead everyone, and sophisticated investors will redo the math anyway.
The recurring errors
Forgotten SAFEs from friends-and-family money. Advisor grants promised in email and never papered. Pool percentages calculated pre-money when the term sheet meant post. Each is an afternoon to prevent and a week of round momentum to fix.