Understanding Share Transfer Amounts
When recording a share transfer in Cake, you'll see two separate amount fields: Investment amount and Transfer amount. They represent different things and are both important for an accurate cap table.
The difference
Investment amount
The original sum paid for the shares by the initial shareholder. This preserves the historical record of capital paid to your company, it does not change when shares are transferred.
Transfer amount
The price agreed between the buyer and seller in the transfer. This is what the new shareholder paid to the previous holder, not to your company.
Example
Shareholder A bought 100,000 shares at $1 each (investment amount: $100,000). They then transfer 50,000 shares to Shareholder B at $2 per share.
On the share transfer transaction, the values would appear as follows:
Investment Amount: $50,000 (original $1 × 50,000 shares)
Transfer Amount: $100,000 (transfer price $2 × 50,000 shares)
The difference between these two amounts doesn't flow through your company, it's a transaction between the two shareholders.