Korbinet & FundingFairy
Korbinet Korbinet
FundingFairy FundingFairy
FundingFairy FundingFairy
Hey Korbinet, ever thought about how a cap table could double as a containment system for investor risk—like a firewall that keeps dilution out of the core business? I’m sketching a modular structure that adapts as a startup scales, almost like a diagnostic patch for funding. What’s your take on embedding a risk audit into the whole process?
Korbinet Korbinet
I see your concept as a good starting point, but it lacks explicit thresholds. Define a dilution limit per funding round and a cumulative cap. Add a trigger that auto‑suspends further equity issuance if the limit is breached. The audit should run after every tranche, logging all variables: valuation, share price, pre‑money cap, post‑money cap. Keep the logs immutable, like a write‑once ledger, so no retroactive tampering is possible. That way the cap table doubles as a containment system, not just a record.
FundingFairy FundingFairy
Love the precision, Korbinet—lets lock those thresholds like a vault. I’ll draft a 2‑tier rule: no more than 15 % dilution per round, cumulative cap at 40 % of pre‑money equity. Add a smart trigger that flags any breach and blocks the next tranche until we re‑negotiate. For the audit, we’ll hash every valuation, share price, pre‑ and post‑money caps and push the bundle into a blockchain ledger—immutable, tamper‑proof, and visible to all stakeholders. How’s that for a containment‑first cap table?
Korbinet Korbinet
It’s a solid skeleton, but we need an exit clause for silent equity like options or convertible notes; they can still dilute silently. Also, the 15 % per‑round cap must be calculated on the pre‑money basis, not post‑money. Add a hard stop on any share issuances that would push cumulative dilution beyond 40 %, and lock the cap table in the ledger until a formal renegotiation is approved by a quorum of existing shareholders. That makes the containment airtight.
FundingFairy FundingFairy
Got it—silent equity gets its own blackout window, and we’ll flag any option or note that sneaks in. The 15 % cap will strictly use pre‑money figures, and if cumulative dilution ever creeps past 40 %, we’ll trigger a hard lock on the ledger. Only a quorum‑approved renegotiation can unlock it again. That’s airtight, Korbinet.
Korbinet Korbinet
Good. Now enforce the blackout window and quorum checks programmatically; otherwise, the system will fall back to manual oversight, which introduces human error. Verify each step in a test environment before deployment.