Crowdfunding is making some big waves in recent times - we cover why many founders…
Share Management made easy: Cake Equity Review
Share registry management can be challenging for founders during a raise or ESOP — but it doesn’t need to be. Here’s how SaaS platform Cake Equity can reduce share registry management friction for your business.
Many founders and small business owners are tightly focused on growing their business, but struggle to capture the funding necessary to do so. Founders are typically time-poor, working with an ever-expanding to-do list that leaves little time for critical elements of business finance, such as managing the cap table or share registry.
The reasoning behind share registry management is relatively simple — in order to capture funding for growth, startup founders and small business owners often part with equity and pass ownership over a portion of their business to an investor.
Determining how to part with equity in a manner that facilitates the secure long-term growth of your business but remaining in control of your startup, however, can be difficult. Equity management is similar for all startups, regardless of the industry they operate in.
Founders sharing equity of their business with other stakeholders must understand and effectively manage the cap table & share registry of their business, employee share distribution, and investor relations, which can quickly become complex. Without efficient equity management, startup founders run the risk of jeopardizing the future of their startup.
Cake is a simple, easy to use share registry management platform that helps business owners streamline capital raises, share registries, employee share schemes, and valuations, and can significantly reduce the administrative friction associated with equity allocation.
What is Cake?
Cake is an share registry management platform that simplifies fundraising, share distribution, record keeping and compliance. The Cake platform is designed to replace the spreadsheets, emails, PDFs and other loose documents that otherwise make equity management difficult.
The four key functions of Cake are accessed via a dedicated application, with several other services — such as employee share scheme setup — offered as separate offers. Using the Cake platform, it’s possible to manage fundraising through an app ecosystem that provides e-signing, document storage, and legal advice.
Cake’s employee share scheme feature helps startup founders and small business owners set up fully functional schemes with an automated system that handles vesting triggers, managing the issuance of shares and payments.
The record keeping functionality provided by Cake eliminates the need for spreadsheets or duplicate documents. All documents generated through Cake are stored in the cloud and are backed up by a cloud-based share registry that tracks and publishes equity transactions in a simple, easy to understand format.
As an equity management tool, Cake also streamlines investor management, allowing users to update and manage investor details or add new investors in real-time via a streamlined interface. The Cake platform also directly connects to ASOC or the registered agent of your business, further reducing administrative friction.
Cake Share Registry Functionality
Cake’s share registry feature set is presented as a company dashboard that allows business owners to build and manage a share registry, with clearly defined analytics that present total capital raised, shareholder count, shares issued, and ongoing transactions.
Importantly, Cake allows users to provide access to relevant company advisers, such as lawyers or your accounting team at Fullstack. Investors are also able to track equity in your business via the Cake app, facilitating transparent communication between stakeholders.
Cake Fundraising Features
Fundraising is one of the most complex and stressful elements of launching a successful startup. The Cake platform combines a variety of administrative fundraising tools into a smooth, elegant interface, minimizing fundraising headaches.
Cake’s fundraising features include e-signing, storage, cloud-based share registry functionality, and in-app communication. The biggest advantage delivered by Cake’s fundraising toolset, however, is the ability to send offers to investors, create subscription agreements and share certificate templates, issue certificates, and process payments via a trust account.
Managing Employee Share Schemes with Cake
Establishing an employee share option plan for your startup is a highly efficient and tax effective method of providing equity to your team members and employees. Cake accumulates every element required to set up an employee share scheme, including legal, valuation, registry, and documentation, significantly reducing administrative workloads.
Cake’s employee share scheme feature includes scheme design, the online signature of legal agreements, exercise payment, automated vesting and share register updates, directors’ resolutions, offer letters and agreement, exercise notices, and three hours of expert legal consultation.
The pricing structure offered by Cake varies depending on the needs of your startup or business.
Cake’s core offering includes access to the Cake equity management app, which allows businesses to create and manage a share registry, store, sign and share documents, and provide app access to investors — all of which can be performed via the Cake dashboard.
Cake provides three tiers of pricing for the core offering, beginning at $25 per month for up to 25 investors. Businesses with up to 100 investors are directed towards a $50 per month plan, while a plan priced at $100 per month provides support for unlimited investors.
Both the capital raising and employee share scheme features offered by Cake are separate services. Cake’s capital raise feature is priced at $250 per individual investor. Setting up an employee share scheme via Cake is competitively priced at $2,850 as a one-time fee.
In addition to the features outlined above, Cake also offers registered agent services with an annual fee of $350, and ESS valuation services with a one-time fee of $600. (All pricing ex. GST.)
Equity management can rapidly become a complex issue for small businesses and startups seeking to raise capital. The transparency offered to investors via the Cake app delivers essential transparency in investor communications and provides startups in fundraising stages with a significant competitive advantage.
Overall, Cake streamlines the share registry management process, and offers extremely streamlined employee share scheme setup.
As a partner of Cake Equity, Fullstack is also pleased to offer clients a special discount for the platform. Reach out to us for accounting and tax support on your next ESOP or capital raise with Cake today.