In a startup world obsessed with big funding rounds, attention to the capitalization table – in other words, the document that keeps track of who owns how much of a company – can easily fall by the wayside.

But did you know that a poorly maintained cap table could mean the difference between success and failure for a company?

In this episode of Tech in Asia Explains, Expara Ventures CEO and managing director Douglas Abrams, Carro CEO Aaron Tan, and Alodokter CEO and co-founder Nathanael Faibis explain the key role that the cap table plays in a startup’s bid to succeed.

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Tech in Asia Explains is a Tech in Asia Originals series that dives into everything that budding entrepreneurs need to know about starting up a business, getting insights from leading personalities from within the industry.

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Transcript:

VO:
Capitalization tables, or cap tables, keep track of a company’s equity – basically serving as a breakdown of a company’s ownership. It might sound like a boring topic to get into, but a messy cap table could sink a potential investor’s interest in a startup.

Douglas Abrams:
Nowadays, I ask in the first meeting about the cap table at the pitch meeting. I have sat through a lot of pitches in the last couple years, where everything sounds great – I like the company, I like the product, I like the market space, I like the management team. But I realize this sounds too good to be true and then I ask about, “How about your cap table?” And the whole thing melts down to nothing.

Aaron Tan:
Even though you can have the best numbers, you may not be able to fundraise – it’s as simple as the fact that you do not have a good cap table.

VO:
Proper cap table management is a sensitive and important subject for founders. So sit up and pay attention as Tech in Asia Explains: Cap Tables.

Let’s start with the basics: What exactly is a cap table? A cap table should have the following details: The names of the shareholders, the number of shares issued – segmented by the type of share – the dates when the shares were issued, and the relative percentage of ownership of each shareholder.