Understanding your company's equity distribution, dilution, and the potential impact of various scenarios is critical for startup founders. Cake's Modeling Tool offers a solution to analyze and forecast these critical factors. In this comprehensive guide, we will delve into how to utilize Cake's Modeling tool, along with its latest updates that make the process even more intuitive and flexible.
Importance of Cap Table Modeling for Startup Founders 💡💼
Cap table modeling empowers founders and investors with insights into the ownership structure of a company. By predicting the effects of different scenarios such as SAFE note and Convertible note conversions, you can forecast dilution, evaluate potential strategies, and plan strategically for your fundraise strategy and long term success.
Latest Updates to Cake's Modeling Features 🎉🎈
Cake has introduced three major updates to enhance the modeling process:
Multi-Round Calculations: Model multiple rounds ahead, offering an extended forecast and insights into changes over time.
Conversion Methodologies: Flexibility in toggling between different conversion methodologies for safe notes, enabling more precise control over your equity analysis.
Saving Scenarios: This crucial update allows you to save scenarios, revert back to them, edit, and delete. Soon, you'll be able to download scenarios to CSV or Excel files.
Accessing Cake's Modeling Tool 🧮🔧
Log into your Cake account.
Navigate to the Tools tab and click on "Modeling" from the dropdown menu.
Inputting Details for Your Upcoming Round 📝💰
Review the existing data in Cake to ensure it reflects your current cap table.
In the Modeling tool, you will find "Starting information" at the top, which pulls existing data from your Cake account.
Add your first round and choose the Round type - Priced round, SAFE or convertibles, or Priced round incl SAFE/Con note.
If you are wanting to model the impact of your SAFEs and/or Convertible Notes converting at your next priced round, choose Priced round incl SAFE/Con note. You can model pre and post-money notes.
Adjust the "ESOP top up settings" to maintain your desired percentage for the option pool.
All SAFEs & Con Notes already uploaded under Note holders in your Cake account will be pre populated in the model, and you can add additional notes to the model that may not already be in Cake.
Analysing Stakeholder and Cap Table Effects 📊📈
Scroll down to view the impact on the company's current stakeholders, including founders, employees, and investors.
Gain insights into the overall effect on the company's Cap Table.
Understand the dilution and potential outcomes based on the modelled round details.
Modeling Different Scenarios & Saving, Editing Models 🔄🔮
Simulate different scenarios and multiple rounds and evaluate their effects.
The Modeling tool now supports multi-round calculations, offering more in-depth analysis.
Choose which round you would like any SAFE / Convertibles Notes to convert at and the conversion methodology (pre or post-money).
Save your scenarios simply to return, edit and adjust later.
Download your saved models as a CSV to share offline.
If you have any questions or need assistance while using the Modeling tool, feel free to reach out to the Cake support team on the online chat 💬 for guidance!