Ownership depends on what is in the denominator.
A fully diluted cap table includes common shares and defined common-equivalent securities. The calculation is straightforward only after the share classes, conversion ratios and unallocated reserve are reconciled.
This model includes all entered options, reserves and warrants at full exercise. It does not use the treasury-stock method from public-company earnings per share. Do not add the full authorized pool and outstanding grants separately if grants already consume that pool.
The formula, made clear.
- As converted
- Preferred shares expressed as common equivalents using the applicable conversion ratio.
- Reserve
- Only remaining unallocated shares plus outstanding options; no double counting.
Put the numbers in context.
6 million common shares held out of 8 million common, 1 million preferred equivalents and 1 million options/reserve represent 60% fully diluted ownership.
| Input | Example value |
|---|---|
| Your common shares | 6,000,000 shares |
| Total common shares | 8,000,000 shares |
| Preferred shares as converted | 1,000,000 shares |
| Options and unallocated reserve | 1,000,000 shares |
| Warrant shares | 0 shares |
| Your fully diluted ownership | 60% |
What this calculation assumes
A snapshot before future financing. No SAFEs, notes, anti-dilution adjustments or contingent issuances unless already converted to share counts. All instruments use the same common-equivalent basis.
What to consider next.
Reconcile this denominator with financing documents before calculating share price, dilution or employee equity value.
How we approach financial models →