If you have a company where knowing the ownership stake as well as the capital structure, then maintaining a well-managed cap table is crucial. There are many benefits to doing this, as well as hiring a third-party for cap table management, here are just a few of them.
Investor Interest
If you have intentions of trying to attract investors, then you should know ahead of time that they will want to know who controls the company. This can be done most effectively through a cap table. They will also want to analyze certain potential scenarios and how payouts and dilution will be affected by these same scenarios.
Employee Stake
If your employees have any sort of stake in the company, they may want to know how much this stake is at any given moment. With cap table management, they can see the real-time value any time that they want to.
Legal Shield
If the government wants or needs to audit your company, then a cap table that has been well-managed goes a long way towards allowing your legal team to present the entire financial history of your company as well as all of its holdings.
New Investors
For current shareholders who want to determine how many shares to allow new investors to gain in relation to capital contributed, a cap table will allow them to make this decision very quickly and with the most reliable information.
If you need software or consultation regarding cap tables, contact EquityTrack at https://www.equitytrack.co/.
