SIMPLY LIFT THE DATA ONCE (IN 3 MINUTES) AND A COMPUTER CAN TRANSFORM IT (IN 3 SECONDS)
A treasure trove of information regarding venture funded companies resides in spreadsheets. But the more insight one wants into the impact of that data on business outcomes, the more complex the presentation becomes.
This results in lots of simple capital structures being presented in a complex manner. As a result, adjusting, verifying and auditing the results become even more costly than creating the original spreadsheet.
The solution is to simplify the capitalization presentation in Excel as follows:
1. Give every column only one security
- For instance, one column for common, the next column for options, the next for Series A Shares, the next for Series A warrants, the next for Series B shares, and the next for Series C shares.
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2. Only two other types of columns should remain in the worksheet you want to transform
- Shareholders/Investors (the left most columns) and
- Total (the right most column, which cross totals each security for a given holder)
- This is also the only column that should have a formula (sum) in it.
3. Give every investing entity a single row
- There should be no subtotal rows for types of investors
- There should be only one row that is calculated: The bottom, Total row.
If you visually inspect the presentation after taking those steps, you will notice that the capitalization table above becomes instantly auditable by the human eye in a matter of minutes. As a result, a computer can audit the relationships and values with even greater accuracy in a fraction of a second.
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