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Founder’s Pocket Guide_ Founder Equity Splits

A concise, practical guide that teaches startup founders how to build and use a capitalization table to track equity ownership, model funding rounds, and plan exits.

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What it’s about

Founder's Pocket Guide: Cap Tables demystifies one of the most important yet intimidating documents in startup fundraising—the capitalization table. Through a single running example that evolves from company formation through option pools, multiple angel rounds, a VC round, and exit scenarios, the book shows founders exactly how shares, ownership percentages, valuations, and dilution interact. It decodes the jargon (pre-money vs. post-money, common vs. preferred shares, fully-diluted shares, Series A) and walks through the simple math behind each calculation so founders can run their own what-if scenarios, negotiate confidently with investors, and present a clean, credible cap table during due diligence. Practical, example-driven, and paired with a downloadable Excel file, it equips scrappy early-stage entrepreneurs to manage their equity story without expensive professionals doing all the work.

The through-line

Who it’s for
An early-stage startup founder who wants to confidently manage equity ownership and raise capital without giving away too much of their company.
The problem
They need to track ownership, model funding rounds, and calculate dilution but lack a clear understanding of how a cap table works. They feel intimidated and uncertain when investors ask about valuation and ownership structure.
The plan
  1. Learn the basic purpose and sections of a cap table.
  2. Set up founder equity splits and an option pool at formation.
  3. Add each investment round with pre-money valuation and investment inputs.
  4. Track dilution and ownership percentages across angel and VC rounds.
  5. Model exit scenarios to test investor returns and your own payout.
The payoff
The founder presents a clean, current cap table that impresses investors during due diligence. · They confidently negotiate valuations and understand the dilution effects of every round. · They can run what-if scenarios and plan exits with realistic return expectations.

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