When you start a new company, you need a simple and easy way to keep track of that business’s ownership. Many companies still rely on spreadsheets to manage their cap table. The reality is that spreadsheets are acceptable very early on, but more sophisticated methods are needed once a business raises capital. As your company grows, a number of things will occur that are sure to complicate your cap table. Fundraising will create new securities and options will likely be allocated to new employees. Additionally, you may need to run what-if analysis to decide on additional funding rounds or even evaluate potential exit scenarios. Relying solely on spreadsheets is extremely time consuming and significantly increases the chance for error.
Most CEOs, especially those raising money from venture funds, can quickly become overwhelmed trying to maintain their cap table and make intelligent fundraising decisions. So where are the automated solutions? Well, the problem is that there few truly comprehensive solutions. Some products are great for analyzing exit scenarios, while others are great for modeling a new round, but few serve as a complete tool for business owners.
Goodbye Spreadsheets! Hello Automated Cap Table Management!
How can you avoid out of date cap table solutions and eliminate error prone calculations? Choosing a cloud-based cap table management solution like SmartCap will alleviate the concerns that plague many business (incorrect formulas, version control, data that conflicts with shareholder agreements, etc.).
It’s time to upgrade how you manage your cap table management and ditch the old manual solutions. Remember, your cap table is more than just a spreadsheet!