Investing with us
Why rebuild a company's cap table before investing?
The valuation in the pitch deck is usually wrong. We rebuild the cap table from scratch because that lays out the battlefield before you commit to anything.
The deck a seller hands you might show $78 million of debt and $180 million of enterprise value. Once we add in accrued PIK interest, shareholder loans, lease obligations, tax and payroll arrears, adjust for true available cash and mark the debt to market, that same business can be closer to $70 million. Nothing about the business changed. It's just marked correctly.
Most analysts take debt at face value off the balance sheet, subtract cash, add book value and call it enterprise value. That's a formula, not valuation. Getting it right requires knowing where the debt actually trades, which is usually not public. It requires relationships.
We also need to know who can stop the deal, not just who owns the economics. A holder with 4% of the equity can carry a class veto over any sale or new money. That person ends up being who you negotiate with, and they can have almost nothing to lose, which makes them expensive.