Founder Vesting & Cap Tables

How to Use SparkLaunch Cap Table

Your cap table is the source of truth for company ownership. SparkLaunch Cap Table helps you track stakeholders, model dilution, and prepare for fundraising.

What the Cap Table Does

• Stakeholder Tracking - Founders, investors, employees
• Ownership Calculation - Automatic percentage calculations
• SAFE/Note Tracking - Pre-money and post-money instruments
• Dilution Modeling - See how future rounds affect ownership
• Investor Share Links - Secure sharing with stakeholders

Getting Started

Step 1: Access the Tool

Navigate to LaunchPad > Cap Table or go directly to /launchpad/cap-table.

Step 2: Set Up Your Company

Enter your basic company information:

• Company name
• Authorized shares (typically 10,000,000)
• Par value (typically .0001)

Step 3: Add Stakeholders

Add each stakeholder with:

• Name and type (founder, investor, employee)
• Number of shares
• Share class (common, preferred)
• Vesting schedule (if applicable)

Step 4: Add SAFEs/Notes

Track your fundraising instruments:

• Investment amount
• Valuation cap
• Discount rate
• Type (pre-money or post-money)

Plan Availability

Plan	Features
Free	Basic cap table, 1 SAFE, 3 share links
Startup (/yr)	Exports, 3 SAFEs, 10 share links
Growth (/yr)	Unlimited SAFEs, vesting, fully diluted view

Understanding Your Cap Table

Key Terms:

• Authorized Shares - Maximum shares the company can issue
• Issued Shares - Shares actually given to stakeholders
• Outstanding Shares - Issued shares not repurchased
• Fully Diluted - All shares + all convertible instruments

Ownership Calculation:

Ownership % = Your Shares / Total Outstanding Shares

For fully diluted: Ownership % = Your Shares / (Outstanding + All Convertibles)

Tracking SAFEs

Post-Money SAFEs (Recommended):

With post-money SAFEs, investor ownership is straightforward:

Investor Ownership = Investment Amount / Valuation Cap

Example: \ investment at \ cap = 2% ownership

Pre-Money SAFEs:

Ownership calculation is more complex as SAFEs dilute each other at conversion.

Dilution Scenarios

Use the dilution modeler to see how future rounds affect ownership:

1. Enter proposed round size
2. Enter pre-money valuation
3. Add any new option pool
4. See updated ownership percentages

Free plan: 3 preset scenarios Growth plan: Natural language simulator

Sharing with Investors

Create secure share links for stakeholders:

1. Select what to share (full view or limited)
2. Generate unique link
3. Send to investor/advisor
4. Track when they view it

Best Practices

1. Update immediately - Add new stakeholders as soon as docs are signed
2. Track everything - SAFEs, options grants, share transfers
3. Model before raising - Know the impact before signing term sheets
4. Regular audits - Quarterly review for accuracy

Common Questions

Q: When should I start tracking my cap table? A: Day one. Even pre-revenue companies need accurate equity records.

Q: How do I handle departed founders? A: Review the signed equity and vesting documents with counsel. A company may have repurchase rights over unvested founder shares, but the outcome depends on the agreements; do not simply erase a former founder from the cap table.

Q: Can I import from a spreadsheet? A: Yes, we support CSV import for existing cap tables.

Founder and Employee Vesting: What the Cap Table Should Show

Vesting determines when equity is earned over time. It helps founders avoid a situation where someone leaves early but keeps a full long-term allocation. A four-year schedule with a one-year cliff is common in venture-backed startups, but it is a negotiation point, not a universal rule. Under that example, 25% vests after 12 months of service and the rest vests monthly over the following 36 months.

Founder restricted stock and employee stock options can work differently. Founders may receive shares up front subject to a company repurchase right that lapses as the shares vest. An employee option grant usually gives the person a right to buy shares as options vest. The signed grant, stock purchase agreement, and equity plan determine the actual rights. Y Combinator explains founder vesting in its formation and fundraising discussion and employee option vesting here.

For each grant, record the recipient, security type, share or option count, vesting start date, cliff, vesting cadence, and any acceleration or repurchase terms. When a founder or employee leaves, reconcile the signed documents, vested amount, exercised options, and any repurchase before updating ownership. Ask your lawyer and tax adviser about legal and tax consequences; the cap table records the result but does not create those rights.

Founder vesting schedule: a worked example

Suppose two founders each receive 4,000,000 shares of restricted stock under a four-year schedule with a one-year cliff and monthly vesting thereafter. If the signed agreement uses a standard 25% first-year cliff, each founder reaches 1,000,000 vested shares after 12 months of continuous service. The remaining 3,000,000 vest over the next 36 months, about 83,333 shares per month. At month 18, about 1,500,000 shares would have vested. This is an illustration, not the legal result for every agreement: the start date, rounding, acceleration, service definition, and repurchase terms all come from the signed documents.

What founders should agree and record

• Start date and cliff: Does service before incorporation count? What happens if someone leaves at month 11?
• Security and ownership: Were shares actually issued subject to repurchase, or were options granted to buy shares later? Do not treat an option grant as already-issued stock.
• Departure and acceleration: Who can repurchase unvested shares, at what price and by what deadline? Is there acceleration after an acquisition, a qualifying termination, or both?
• Approvals and evidence: Keep board approvals, signed purchase or grant agreements, payment evidence, IP assignments, and the cap table in agreement.
• Tax review: If substantially nonvested property was transferred, ask qualified tax counsel promptly whether an 83(b) election applies. The IRS Form 15620 instructions state a 30-day filing deadline measured from the property transfer date. An option grant is not the same event as receiving restricted stock.

Before entering a vesting schedule in SparkLaunch, check the signed terms against the cap table. Record changes as documented transactions; do not silently replace the original grant when a founder leaves. For the broader ownership workflow, see the startup cap table guide and 83(b) election guide.