A capitalization table lists every security the company has issued or promised, who holds it, and what share of the company it represents. At formation it has three lines. By Series A it has dozens, and the first thing a lead investor’s counsel does is rebuild it from the signed documents to see if the company’s version matches.

The template below is the minimum set of columns that makes that rebuild easy. The worked example then runs one company from founder stock to a Series A.

This is general information, not legal or tax advice.

The template

Three rules for filling it in:

1. Every number traces to a signed document. Founder shares to the stock purchase agreement, options to the grant notice and board consent, SAFEs to the signed SAFE.
2. Outstanding and fully diluted are different columns. Outstanding counts only issued shares. Fully diluted adds granted options, the unissued pool and convertibles on an as-converted basis.
3. SAFEs are recorded by dollar amount and cap until they convert. The share count appears only when a priced round fixes it.

Snapshot 1: at formation

Assumptions
- 10,000,000 shares reserved or issued in total
- Two founders, 4,500,000 shares each
- 1,000,000-share option pool adopted; 300,000 granted to an engineer

Holder          Security          Shares       % fully diluted
Founder A       Common         4,500,000            45.00%
Founder B       Common         4,500,000            45.00%
Engineer        Options          300,000             3.00%
Pool            Unissued         700,000             7.00%
Total                         10,000,000           100.00%

On an outstanding basis, each founder owns 50%, because only the 9,000,000 founder shares are issued.

Snapshot 2: two post-money SAFEs convert

Y Combinator’s post-money SAFE converts at a “Safe Price” equal to the post-money valuation cap divided by the “Company Capitalization.” That capitalization includes all outstanding shares, options, the existing unissued pool and the SAFEs themselves. It excludes any pool increase made for the priced round. The practical result, per YC: ownership sold on a SAFE equals the investment divided by the cap.

Assumptions
- SAFE 1: $750,000 at a $7,500,000 post-money cap  -> 10.0%
- SAFE 2: $250,000 at a $10,000,000 post-money cap ->  2.5%
- Total sold on SAFEs: 12.5% of the post-SAFE capitalization

Company Capitalization = 10,000,000 / (1 - 0.125) = 11,428,571 shares
SAFE 1 price = $7,500,000 / 11,428,571 = $0.65625 -> 1,142,857 shares
SAFE 2 price = $10,000,000 / 11,428,571 = $0.875  ->   285,714 shares

Holder          Shares        % fully diluted
Founder A    4,500,000            39.38%
Founder B    4,500,000            39.38%
Engineer       300,000             2.63%
Pool           700,000             6.13%
SAFE 1       1,142,857            10.00%
SAFE 2         285,714             2.50%
Total       11,428,571           100.00%

The two SAFEs do not dilute each other’s percentage. That is the point of the post-money structure.

Snapshot 3: Series A with an option pool top-up

Assumptions
- Series A: $3,000,000 at a $12,000,000 pre-money valuation
- Post-money: $15,000,000, so new investors own 20%
- Term sheet requires the unissued pool to equal 10% post-money,
  with the increase counted in the pre-money (the "option pool shuffle")
- Both SAFE prices are below the Series A price, so the caps apply

Solve for total post-money shares T:
  Investor shares   = 0.20 x T
  Unissued pool     = 0.10 x T = 700,000 + increase
  Pre-money shares  = 0.80 x T = 11,428,571 + increase
  -> 0.70 x T = 11,428,571 - 700,000 -> T = 15,326,530
  Pool increase = 1,532,653 - 700,000 = 832,653
  Investor shares = 0.20 x 15,326,530 = 3,065,306
  Price per share = $12,000,000 / (0.80 x 15,326,530) = $0.97870 (rounded)

Holder           Shares        % fully diluted
Founder A     4,500,000            29.36%
Founder B     4,500,000            29.36%
Engineer        300,000             1.96%
Pool          1,532,653            10.00%
SAFE 1        1,142,857             7.46%
SAFE 2          285,714             1.86%
Series A      3,065,306            20.00%
Total        15,326,530           100.00%

Real closings round the price to a fixed number of decimals and shares to whole numbers, so the last digit moves. The structure does not.

How to read someone else’s cap table

When a cap table arrives from a co-founder, a lawyer or a software export, check these in order:

1. Do the totals foot? Add every row. Then check the share count against the authorized shares in the certificate of incorporation.
2. Is the pool split into granted and unissued? A single “pool” line hides how much room is left for hiring.
3. Are SAFEs listed with cap, discount and MFN terms? A SAFE with no cap shown is a question, not a detail.
4. Do vesting terms appear for founders and employees? The vesting schedule for founders article explains what to look for.
5. Is there a pro forma column for the next round? A cap table that only shows today cannot answer what the founders will own after the next raise.

Spreadsheet or software

A spreadsheet works at formation. It gets harder after the first option grants, when vesting and exercises have to be tracked, and after SAFEs, when conversion depends on the next round’s terms. Software stores the documents with the ledger and models conversions. The site’s roundups of cap table management software and Carta alternatives compare published pricing. Whatever tool is used, the documents are the record; the cap table is a summary of them.

For the split behind the founder lines, see how much equity to give a co-founder.