What is the “Cap Table” (Capitalization Table) and why should it be managed carefully?

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It is a spreadsheet or record that shows the detailed distribution of company ownership, identifying who the shareholders are, how many shares/stakes each one holds and what their ownership percentage is. Keeping a well-organized Cap Table and avoiding excessive dilution of the founders in the early rounds (ideally retaining more than 70-80% at the seed round) is crucial to being attractive to future institutional investors.

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