# How a pro forma cap table can help you secure your next round

Author:

The Carta Team

| Read time: | 8 minutes |
| --- | --- |
| Published date: | 15 January 2026 |

Learn about pro forma cap tables, why you need one for fundraising, and how to use it to model dilution and make better decisions for your company.

## What is a pro forma cap table?

A pro forma capitalization table is a projection of your company’s equity ownership structure after a potential investment, merger, or other financing event. It’s a forward-looking model that shows you and your potential investors what the company’s [cap table](/content/sg/en/learn/startups/equity-management/cap-table/index.html) will look like after the new investment is complete. The pro forma cap table takes your current cap table and adds in the variables of a new [funding round](/content/sg/en/learn/startups/fundraising/index.html), such as a new investment amount and the conversion of previous securities.

## Why a pro forma cap table is critical for fundraising

As a founder, a pro forma cap table is one of your most powerful tools during a fundraise. It’s a way to build investor confidence and negotiate from a position of strength. Presenting a clean, accurate pro forma signals that you are a professional and organized early-stage entrepreneur who takes [equity management](/content/sg/en/learn/startups/equity-management/index.html) and ownership seriously.

A pro forma cap table also empowers you by providing a clear picture of [equity dilution](/content/sg/en/learn/startups/equity-management/share-dilution/index.html) and its impact on your company’s total outstanding shares. You can enter negotiations knowing exactly how your ownership stake will change.

## What are the key components of a pro forma cap table?

To build an accurate pro forma, you need to model several key inputs:

- **Pre-money valuation**: This is the value of your company _before_ a new investment round begins.
- **New investment amount**: The total cash you’re raising in the financing round.
- **Convertible instruments**: These include [SAFE agreements](/content/sg/en/learn/startups/fundraising/convertible-securities/safes/index.html) or [convertible notes](/content/sg/en/learn/startups/fundraising/convertible-securities/#what-is-a-convertible-note/index.html) and detail how they convert into equity.
- **New share class**: Typically involves a new class of [preferred shares](/content/sg/en/learn/equity/common-stock-vs-preferred-stock/#what-is-preferred-stock/index.html).  
- **Employee option pool**: This may be required to ensure enough [equity](/content/sg/en/learn/equity/index.html) is set aside to attract talent.

## Pro forma cap table example: Before and after a Series A

To illustrate, let’s look at a hypothetical structure:

| **Shareholder** | **Ownership before Series A** | **Ownership after Series A** |
| --- | --- | --- |
| **Founders** | Majority ownership (75%) | Diluted ownership (51%) |
| **SAFE investors** | Future equity right (15%) | Preferred stock ownership (12%) |
| **New Series A investor** | No ownership (0%) | New ownership stake (25%) |
| **Employee option pool** | Existing pool size (0%) | Increased pool size (12%) |

## How to create a deal-ready pro forma cap table

Building a pro forma cap table can feel overwhelming. You can choose between using a spreadsheet or dedicated [cap table management software](/content/sg/en/equity-management/cap-table/index.html).

### The manual way: Building a pro forma cap table in a spreadsheet

Using spreadsheets can be risky. Small mistakes can lead to miscalculations and damage trust with investors. Issues such as no version control, no audit trail, and legal liability arise with manual processes.

### The professional way: Generating a pro forma cap table with Carta

Using a platform like Carta avoids the manual errors common in spreadsheets. [Carta’s Deal Pro Forma tool](/content/sg/en/product-updates/automated-deal-pro-forma/index.html) automates creating a pro forma model quickly and accurately.

## How to analyze your pro forma cap table for dilution and ownership

Using the pro forma strategically helps answer the critical question: “How much of my company will I own after this round?” Key negotiation points include pre vs. post-money option pool increases and SAFE conversion timing.

## From pro forma to closed deal: What comes next

The pro forma cap table is just a milestone. After finalizing the deal, be prepared for new accounting requirements and obtaining a new [409A valuation](/content/sg/en/learn/startups/equity-management/409a-valuation/index.html).

## Frequently asked questions about pro forma cap tables

### What is a PF cap table?

A PF cap table is simply another name for a pro forma cap table, projecting your company's ownership after a financing event.

### How do SAFEs and convertible notes affect a pro forma?

They are calculated based on the terms in each agreement, determining how many shares a SAFE or convertible note holder receives.

### Is a pro forma cap table legally binding?

No, it is a projection and not legally binding. The signed financing agreements make the new ownership structure official.

### What are common red flags in a pro forma?

Unexplained ownership gaps, mismatched conversion calculations, or missing increases in the employee pool are red flags.