How to build a business: Focus on the cap table

Cap table is the ownership structure of the company.

If you find that founders have become a minority stakeholder in the company before it has achieved some degree of success (typically before Series B round of funding), it is time to take a serious look at the future of the company. Make sure you have investors who have bought into your vision. If they have not, they might second guess each and every one of your decisions.

It’s extremely important to have a good handle on the cap table. Make sure the decision makers in the company continue to be invested in the company.

When you are building the company, sometimes most outrageous and crazy ideas tend to be the most successful ideas. However till you have achieved success, you will go through a lot of ups and downs. You need people who are in the trenches with you during these phases. Only then will you be able to work hard through them and achieve lasting success.

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