Equity or cap-table administration

A cap table is the record of who owns what in your company. It lists every shareholder and their shares by class, plus everything that can turn into shares later: options, warrants, SAFEs and convertible notes. A useful cap table shows ownership both on an issued basis and on a fully diluted basis, and tracks vesting schedules, the size of the option pool and the terms of each financing. Investors and acquirers will rebuild it from your legal documents during diligence, so it has to match them exactly.

A US company needs a 409A valuation before it grants stock options, because options must be priced at or above the fair market value of the common stock to avoid tax penalties for employees. A 409A from an independent appraiser gives you a safe harbor. It is generally treated as valid for up to 12 months, but a material event, such as a new priced round, a major contract or an acquisition offer, can make it stale sooner. Most companies refresh it after each financing and at least once a year.

A spreadsheet works for two founders and a couple of SAFEs. It starts to break once you are granting options, converting notes or SAFEs, or preparing for a priced round, because conversion math and vesting are easy to get wrong. Moving to dedicated equity software before your first priced round is a common rule of thumb. It keeps a clean record of grants and exercises, handles 409A workflows, and gives investors and lawyers one version of the truth during diligence.

The most frequent problems are unsigned or missing board approvals for option grants, founders without vesting or without 83(b) elections filed in time, promised equity that was never documented, SAFEs and notes whose conversion was modeled wrong, and option pools that do not match what the board approved. Each one can delay a financing or an acquisition while lawyers fix it. The cheapest time to clean them up is before an investor or buyer starts diligence, not during it.