Cake

A few weeks ago, we attended and sponsored SaaStr Ai in San Francisco. There's something you can't replicate about being on the floor, face to face with the people living and breathing the problems you're solving. The conversations that stood out weren't just about cap tables, scaling complexity & integrating AI - they were about employees & getting the most out of their equity. Real conversations. Real problems. Apparently very good merch too 😉 🧢 Britt de Visser Garrison G. #SaaStrAI #StartupEquity #EquityManagement

Your 409A is not your valuation A 409A valuation sets the exercise price for your team's stock options. Get it wrong, and you're exposing both yourself and your employees to serious tax liability. 👉 Here's what most first-time founders miss: Your 409A valuation is not the same as your fundraising valuation. It values common stock, not preferred. It's almost always lower than your last round, and that's by design. The lower your 409A, the more upside your team gets when they exercise. What to look for in a provider: transparent pricing, a streamlined process, and — critically — someone who will actually get on a call if the number doesn't make sense. An audit-defensible valuation you don't understand is almost as dangerous as not having one. You need a new 409A at least once a year, or after any material event like a funding round. If you're planning to make offers in Q2, now is the time to get this done. We built 409A ordering directly into Cake - order it through the platform, bundle it with your subscription, and get it turned around in days, not weeks 🍰 Callum Davidson explains the fundamentals. #409A #startupequity #equitycompensation

The most expensive line in your comp stack didn't exist 12 months ago... Salary. Bonus. Equity. AI tokens. That's the new compensation stack, according to Tomasz Tunguz at Theory Ventures. He estimates that giving an engineer unlimited AI inference access now costs $100K+ per year, over 20% on top of a $375K fully loaded salary. Some companies are treating it like a perk. Others are bundling it into offers like a signing bonus. Either way, it's real money — and it's changing how founders need to think about total comp. Here's what that means for equity: if your total cost per engineer just jumped 20%, the option pool math changes too. The grant that felt generous six months ago might not look the same when AI costs eat into the budget. Founders who model their comp stack as four lines instead of three will make sharper offers - and keep their burn rate honest 🍰 #equitycompensation #startupequity #equitymanagement

Your engineer's stock options could be worth $245,000. Do they know? Here's the math: 10,000 options at a $0.50 strike price. Four-year vest. If the company hits $25/share at exit, that's a $24.50 gain per option = $245,000 total. But that number means nothing if your team doesn't understand the mechanics. Vesting schedules, exercise windows, strike prices, tax implications (most employees glaze over after the first sentence). That's not their fault, it's a communication problem. The founders who retain top talent don't just hand over a grant letter and move on. They make equity tangible. They show what the numbers could look like under real scenarios. When your team sees their upside clearly, equity stops being an abstract promise and starts being a reason to stay 🍰 Callum Davidson walks through the full options lifecycle: from grant to gain. #employeeequity #equitycompensation #startupequity Garrison G. Britt de Visser

A pre-revenue founder's first hire left a $200K job to join her startup. It wasn't the equity that got him there. It was mission — believing they could change how people work. But here's what she learned: mission gets people in the door. Fair, transparent equity keeps them there. Too many early-stage founders lean on vision and avoid the harder equity conversations. The ones who retain their best people don't treat equity as an afterthought. They make it clear, fair, and part of how trust gets built from day one. Kim H. breaks it down 🍰 #employeeequity #startupequity #equitymanagement

What if two investors in the same round paid different prices for the same equity? That's exactly what happened at Aaru - a synthetic-customer research startup that raised with Redpoint investing at both a $450M and $1B valuation in the same round. Strategic investors who bring distribution got a lower entry price. Financial investors writing bigger cheques paid more. It sounds unusual. But the logic is straightforward: when a partner can 10x your growth trajectory, giving them a better entry point can work for everyone at the table. We are seeing the fundraising playbook changing. One round, one price isn't the only option anymore. 🍰 What this means for you: the cap table implications of differential pricing are real. Before you sign anything, model the dilution across every investor class. The founders who walk away with better outcomes are the ones who run the numbers first. h/t Marina Temkin, CFA at TechCrunch for this one 🔗 article in comments #startupfunding #venturecapital #startupequity Callum Davidson Britt de Visser Garrison G. Kim H.

Form 3921 deadline — what happens if you miss it? March 31 is the Form 3921 deadline. If any of your team exercised stock options in 2025, you're required to file. Miss it, and you're looking at IRS penalties — plus a team that doesn't have the documentation they need to file their own taxes correctly. That's the kind of thing that erodes trust fast. Here's what you need to know: Form 3921 reports each stock option exercise from the previous year. It goes to both the IRS and your employee. If you had even one exercise event in 2025, this is on you as the issuing company. 🍰 The good news: if your cap table is up to date, pulling this together takes minutes, not days. Cake has Form 3921 built in — no chasing spreadsheets, no guessing which exercises happened when. Two weeks left. Avoid the last minute scramble 🍳 More on how Cake handles Form 3921 - link in comments 🔗 #startupequity #equitycompensation #equitymanagement Britt de Visser Garrison G. Charlie Ross

To my network of founders... fundraising in 2026 is not just about the pitch. Make sure you are prepared behind the scenes: your cap table, docs, reporting, and investor readiness. We broke down 10 ways founders can set themselves up for a smoother raise this year. Read it at the link in the comments. Cake 🍰 💙

🚢 Not all harbors are safe... but there's a reason why they're good for your 409A. Under IRC 409A, when you're issuing equity to your team, you have to value your common stock. You can DIY it — or hire a qualified independent appraiser. That choice matters more than most founders realise: → DIY = if the IRS questions it - you have to prove the value is right. → Independent appraiser = same question - now the IRS has to prove you wrong That's a safe harbor ⚓️ Full video + our 409A guide in the comments 👇 #409A #CapTable #EquityManagement #StartupEquity

Steve Jobs was given stock options deemed "in the money" — and not taxed appropriately on it. That's why the 409A valuation exists. Your team's equity should be something they celebrate. Not something that surprises them at tax time. 409A is built into Cake. Thanks Steve Allan for sharing your wisdom in this clip - to check out the full vid see the link in comments 🔗  #409A #startupequity #equitycompensation