Deal Mechanics

The cap table is probably the single most important spreadsheet in any venture deal. It says who owns what, how that changes as new money comes in, and what everyone's stake is actually worth under different exit scenarios. This one covers the mechanics, how dilution compounds round over round, and how to read a cap table fast. If you can build one in Excel by the time you're done, you're already ahead of most first-year associates.

6 resources

Early-stage rounds use lightweight instruments (SAFEs and convertible notes) so both sides can close in a week instead of a month. Later rounds use priced equity. You need to know the difference between these three and exactly what each one does to the cap table when it converts. Pre-money vs post-money SAFEs especially trip people up, including people two rounds in. We'll go through it.

Resources coming soon

A term sheet is a two-page document that settles how much a company is worth, who has control, who gets paid first if things go wrong, and what the founders can and can't do without the board's permission. We'll walk through the economics (valuation, option pool, liquidation preference, anti-dilution) and the control terms (board composition, protective provisions, drag-along, tag-along). You don't need to be negotiating these yet. You just need to be able to read one without getting lost.

Resources coming soon