Startup Accounting Dictionary

83(b) election

An 83(b) election is a formal document that you sent to the IRS to state you are electing to buy your stock immediately, even if it hasn’t all vested. You file an 83(b) to lock in your stock prices so that you have a low tax basis.

Accounting

Accounting includes bookkeeping, the process of recording a business’s financial transactions, but takes that information and verifies, reports, and analyzes the results. The results are compiled into financial statements and presented to a number of entities, including investors, lenders, regulators, tax authorities, and other company stakeholders. 

Accounts receivable

Accounts receivable are the balances due from customers of a company that have purchased goods or services but have not yet paid for them.

Accounts payable

Accounts payable refers to the money a company owes to vendors or suppliers that have been purchased on credit.

Accredited investor

An investor that can participate in venture capital, private equity funds, angel investments etc. In order to be an accredited investor there is no standardized federal verification process, but you must meet at least one of the specific criteria.

This criteria consists of either having earned an excess of $200,000 (or $300,000 with a spouse) in each of the past two years with similar prospects for the current year. Having a net worth in excess of $1 million (together with a spouse or individually) or holding a series 7, 65 or 82 license in good standing.

The lack of official verification means it is a startup’s responsibility to assess the accredited investor’s status and reputation.

Acqui-hire

Purchasing or acquiring a company for the purpose of hiring the company’s staff. 

Administration fee

The fee incurred to cover the cost of administration (record keeping/filing/other administrative costs) when a line of credit, convertible note, a new loan, SPV or other financing vehicles is taken out from a bank, investor or lender.

Amortization

Amortization is used in different ways in accounting. One definition is a series of fixed payments that reduces or pays back a debt (loan amortization). Amortization is also used to refer to the process of gradually writing off an intangible asset, similar to depreciation. For example, the Tax Cuts and Jobs Act required companies to amortize their research and development (R&D) deductions over five years for domestic R&D and 15 years for foreign R&D.

Angel group

A professional organization of angel investors who collaborate in evaluating and identifying potential investment opportunities. When an opportunity is discovered they collectively write a check from pooled funds. As part of the startup ecosystem, they often have connections to later-stage investors, and frequently provide introductions to these investors.

Annual contract value (ACV)

Annual contract value (ACV) is the total amount of revenue generated by a customer contract, excluding any fees. ACV is a metric used by software as a service (SaaS) companies, and is normally an annual average derived from the total contract value (TCV).

Anti-dilution clause

A clause in a funding contract that protects an investor from having their percentage of company ownership reduced in subsequent fundraising rounds. 

Asset light

The term used to describe a business when the majority of its assets on the balance sheet have little to no depreciation. In other words, the company only has a small amount of fixed assets. To be asset-light generally means a business will have a better return on assets, greater flexibility, and lower profit volatility. For example, companies in the service sector are commonly asset-light.

Authorized Shares

Based on a company’s articles of incorporation, authorized shares are the maximum number of shares a business is allowed to issue. A company’s authorized shares must never be exceeded by its outstanding shares.

Bad debt

Debt is a fundamental part of business, but businesses can have both good and bad debt. Bad debt is debt that can’t be collected, and it’s eventually written off. Bad debt is something that all businesses that extend credit to customers have to account for, since there’s always a risk that payment won’t be collected.

Balloon Payment

A balloon loan is a type of loan that generally has a high interest rate, lower payments, and a lump sum to be paid at the end of the loan’s term. Unlike other loan types, where the payment plan usually dictates a fixed amount to be paid in installments, a balloon loan (seen to be riskier than an amortized or installment loan) requires a significantly larger final payment compared to any of the prior payments made.

Basis

The initial cost of an asset, from which gains or losses are calculated.

Binding agreements 

A legal contract that meets several criteria: legality (the agreement doesn’t violate any laws); adequate consideration (something of value is exchanged); capacity (both parties understand what they’re doing); and mutual assent (offer and acceptance). If a contract meets these requirements, it is enforceable by a court. If one party doesn’t hold up its end of the bargain, the other party has legal remedies for any damages from breaking the contract.

Board rights

The rights of each member of the board within an organization, outlined the organization’s bylaws. These rights can include voting power, raising points of discussion, requests for financial inspection, and calling board meetings.

Bookings ARR

Annual recurring revenue (ARR) is a metric that shows the amount of money coming in ever year, and it’s very valuable for SaaS startups or any business that works on a subscription basis. ARR is the value of a startup’s recurring revenue from subscriptions over a single calendar year. ARR looks at historical revenue, however, so some startups like to also look at bookings ARR. Bookings ARR is the value of new annualized contracts that are booked in a given period, regardless of when that revenue will be recognized. This metric can provide a better view of a company’s revenue growth and sales performance, since many enterprise B2B SaaS companies have a long sales cycle. Booking ARR can be distorted by customer cancellations, so it’s important to remember that.

Bootstrapping

Bootstrapping refers to self-financing a startup without relying on angel or seed investors.

Bridge loan

These short-term loans help startups by providing funding to allow startups to reach the next round of funding or remove an existing obligation.

Burn Multiple (SaaS Metric)

A SaaS burn multiple is a metric that measures a company’s efficiency at producing new ARR vs. the amount of capital used. It’s calculated by dividing the net cash burned by the net new ARR in a given period. Lower burn multiples are better, as this shows that the startup burns less capital to generate its growth. Decent burn multiples are under 2x, whereas the best are under 1x.

Business expenses

Normal and necessary expenses that are required to run a business.

Business loans

Business loans provide startups with financing, either as a lump sum or a credit line. This funding is provided to a business with the understanding that it will be paid back under a set of terms, usually with interest and fees.

C corporation (C-corp)

The most common type of corporation in the US, a C-corp is named for subchapter C of the Internal Revenue Code that outlines the tax differences between C-corps and other corporations. In general, a corporation is a legal entity that has shareholders, directors, and officers, and the shareholders are not personal responsible for any debts of the corporation.

California Statement of Information

The California Statement of Infomration is an annual report that legal entities in California need to file. The report updates the state about the company’s business status and principal officers and directors. A newly formed business has to file the first Statement of Information within 90 days of filing Articles of Incorporation, and the annual updates are due on the last day of your anniversary month. Most corporations can file their annual Statements online at the Secretary of State’s website for $25.

Capital

Capital refers to a startup’s financial assets, like funds in deposit accounts. Capital can be raised from financing sources like angel investors, venture capital funds, or venture capital lenders.

Capital gain

Capital gains are the profit earned when an asset, such as stocks, bonds, or real estate, is sold for more than the purchase price. Capital gains are taxed at different rates depending on how long the asset is held, either less than one year or more than one year.

Capital under management

The amount of money a fund, group or syndicate has available to invest in new investment opportunities. Typically, a VC fund calculates capital under management by adding up the total amount of capital committed by its investors across all of its funds.

Cash accounting

Cash accounting recognizes revenue or expense transactions only when payment is exchanged.

Cash drag

Cash drag refers to the negative impact on a VC fund’s performance caused by holding uninvested capital. It occurs when a fund has cash on hand that’s not being invested in startups, earning little to no return while still being factored into the fund’s overall performance metrics. To minimize cash drag, VC funds must carefully balance having enough capital available for investments while avoiding excessive idle cash, as this can lower the fund’s internal rate of return (IRR) and potentially impact its competitiveness in the market.

Cash outflow

A startup’s cash outflow equals the amount of its expenses that exceed its generated income.

Cash management

Cash management, also known as treasury management, involves administering cash inflows and outflows to maintain financial stability. For startups that don’t typically generate profits or revenue, cash management focuses on preserving the company’s capital and maximizing liquidity.

Cash position

A startup’s cash position is the amount of cash it has on its books at a certain point in time.

Chart of accounts

A chart of accounts lists all the financial accounts included in a startup’s financial statements, and allows all of the financialtransactions to be categorized during a specific accounting period.

Chief financial officer (CFO)

A CFO manages a startup’s financial activities, including financial planning and analysis, as well as managing cash flow. For startups, hiring a CFO becomes a priority when the startup begins to raise more significant funding. 

Churn

A startup’s churn rate (also known as attrition rate) is the rate at which customers stop doing business with the startup over a specific time period. A high churn rate indicates that there’s something about a startup’s product or service that customers don’t like or didn’t expect.

Cloud accounting

Cloud or online accounting relies on cloud-based accounting software, rather than traditional desktop accounting progams. Accountants can log into an always-updated accounting system online and all data is stored safely and securely on a cloud server. Most cloud systems also include a variety of third-party APIs that connect with a business’s other systems.

Collateral

Collateral is any sort of asset owned by a startup which is used to secure loans or other debt. Collateral is offered as “insurance” for paying back the loan.

Conversion rights

The right given to investors to convert preferred stock into common stock. Conversion rights can be optional or mandatory, depending on the startup’s circumstances.

Convertible preferred stock

Shareholders with convertible preferred stock are entitled to convert their shares into a fixed amount of common shares on a predetermined date.

Covenants

A covenant is a clause within a debt agreement that either prevents borrowers from making financial actions that may lead to them being unable to meet the payment terms of the agreement (negative covenant), or forces borrowers to perform specific actions in order to meet them (affirmative covenant).

Creditor

Institutions or individuals who have the resources to issue credit (debt) to other businesses. In order to receive a loan from a creditor, a company will usually have to offer some form of collateral or personal guarantee.

Current asset

Current assets are all assets that are reasonably expected to be converted into cash within one year or during the normal operating cycle of the business. These include cash and cash equivalents, marketable securities, accounts receivable, inventory, and other short-term assets. Startup founders should not only track their cash, but also understand how current assets like accounts receivable changes, as this should be a source of cash flow for a startup, or inventory, which can consume cash if more inventory is purchased but can create cash flow if product is sold and inventory is sold down.

Customer acquisition cost (CAC)

Customer acquisition cost is the amount a startup spends to find new customers and convince them to buy its product or service. CAC includes sales and marketing costs as well as any property or equipment used to acquire new customers.

Debt capital

A financing option for startups, debt capital is raised by startups by taking out a loan, and is usually an alternative to equity capital.

Delaware C corporation

A Delaware C corporation is a taxable business entity legally registered in Delaware, and is often preferred by startups because of the laws in Delaware that protect investors, and the fact that venture capital firms and investors are familiar with these laws and procedures. 

Depreciation

A planned, gradual reduction in the recorded value of an asset over its useful life. Depreciation is charged to expense, and the company is generally spreads the depreciation over the period of time during which the asset is earning revenue.

Directors and Officers (D&O) insurance

Directors and Officers (D&O) insurance is a specialized form of liability insurance designed to protect individuals serving as directors or officers of a company from personal losses if they are sued for decisions made in their official capacity. This insurance covers legal fees, settlements, and other costs associated with defending against such lawsuits, and it can also provide financial protection for the company itself if it is named in a lawsuit. D&O insurance is essential for attracting and retaining qualified leadership, as it offers peace of mind by safeguarding personal assets against claims related to management decisions.

Double-entry bookkeeping

Double-entry bookkeeping, sometimes called double-entry accounting, is a standard accounting method that records each transaction in at least two accounts, creating a debit in one or more accounts and a credit in one or more accounts. 

Due diligence

Due diligence is conducted by investors or company acquirers to make sure the financial information provided by a startup is accurate, and allows them to assess whether or not the startup is a good investment.

Equity

The value of shares issued by a company.

Estimated tax payments

Profitable businesses make estimated federal income tax payments throughout the year, one per quarter. 

FATCA (Foreign Account Tax Compliance Act)

The Foreign Account Tax Compliance Act requires foreign financial institutions and some other non-financial foreign entities to report on the foreign assets held by US account holders. 

Finance as a Service (FaaS)

Finance as a Service (FaaS) companies offer integrated accounting, bookkeeping, financial, and business strategy products and services.

Financial statements

The three main financial statements for every business are the income statement, the balance sheet, and the cash flow statement. The three statements represent the financial status of the business, and they work together to present a complete picture of the company.

Fixed Costs

Fixed costs are expenses that remain constant regardless of a startup’s revenue or production levels, such as office rent, full-time employee salaries, and insurance premiums. These costs must be paid regardless of sales and are distinct from variable costs, which fluctuate based on business activity.

Understanding fixed costs is important because they affect financial planning, investment decisions, and long-term sustainability, helping founders determine break-even points and develop effective pricing strategies.

Form 941

Form 941 is used by businesses that report income and payroll tax withholdings on a quarterly basis. Form 941 is used by large employers with payroll tax and withholding liabilities of more than $1,000 annually.

Form 1095-B

This tax form reports the type of health insurance that a company provides to its employees and their dependents. It also outlines the dates that employees and their dependents were covered by insurance.

Form 1099

Startups must distribute 1099 forms by January 31 to any contractor to whom the startup has paid more than $600 during the year. Read our article on 10 Reasons a Startup Can’t Use it’s Payroll Provider for 1099 Creation.

Form 3921

Form 3921 reports the exercise of employee incentive stock options (ISOs) to the IRS.

Form 5472

Form 5472 provides the IRS with information about US businesses that have foreign ownership, or foreign businesses that do a significant amount of business in the US.

Forward commitment

A forward commitment in venture debt is a contractual agreement that allows a startup to secure future access to capital from a lender, typically for a period of 9 to 15 months after raising equity. This arrangement provides startups with valuable optionality, as they can draw down the debt capital when needed to extend their runway or achieve important milestones, without being obligated to use the funds if they’re performing well. By setting up a forward commitment soon after raising equity, startups can leverage their strong financial position to negotiate favorable terms, while also providing themselves with a financial safety net for future needs.

Founder Preferred Stock

Founder preferred stock (also called series FF preferred stock) is a relatively new concept. Preferred stock comes with rights and privileges that make it more valuable. Normally founders receive common stock. However, some founders may receive a percentage of their normal allocation of common stock as preferred stock, allowing founders to sell those preferred shares at a higher price.

Fundraising

This is the process uses to generate capital, primarily by exchanging equity for investment dollars, but also includes borrowing capital through debt financing.

General ledger

The general ledger is a comprehensive record of all financial transactions within an organization, serving as the backbone of a company’s accounting system. It contains detailed accounts for each type of asset, liability, equity, revenue, and expense, providing a complete picture of the company’s financial position and performance. The general ledger is used to prepare financial statements, track historical transactions, and ensure the accuracy of a company’s financial records through the double-entry bookkeeping system.

Gross Merchandise Value (GMV)

Gross Merchandise Value or GMV is the total end-value to the customer of a product sold through a marketplace, or the total value of goods sold by an eCommerce startup. It’s generally calculated as the total value paid by the purchaser-side of the marketplace.

Incentive stock options (ISO)

Incentive stock options are a type of equity compensation, used to motivate and retain employees. ISOs are granted only to employees, who can then purchase a set quantity of shares at a specified price, and get favorable tax treatment.

Incubator

Like an accelerator, incubators offer capital and mentorship in exchange for equity, but often focus more on innovation, trying to nurture an idea into a viable business model.

Insured cash sweep accounts

Also called networked deposit services, insured cash sweep (ICS) accounts distribute a startup’s funds in increments of $250,000 among a network of banks, maximizing the FDIC insurance coverage.

Lead investor

The investor or firm that takes a primary role in negotiating a startup capital investment and conducting the necessary due diligence.

Local tax

A tax charged by a local government, usually a city or county.

Mergers and acquisitions (M&A)

The process of combining two companies into one is called mergers and acquisitions, and includes company finances, management, and strategy. The process may help the company grow faster or allow it to compete in a new business sector.

Negative pledge on IP

A negative pledge on IP is a type of covenant used by venture debt lenders to prevent a borrower from pledging their intellectual property (IP) assets to others.

Net burn rate

Net burn rate is a crucial financial metric that measures the total amount of money a company loses each month after accounting for its revenue. It is calculated by subtracting monthly revenue from the gross burn rate (total monthly expenses), providing a more comprehensive view of a company’s financial health than gross burn rate alone. For startups and growing companies, monitoring net burn rate is essential as it helps determine the cash runway, guides strategic decision-making, and indicates how quickly the company is using up its cash reserves while considering its ability to generate income.

Net Income

Net Income is the final profit figure on a company’s income statement, representing the total amount of money a startup has earned after deducting all operating expenses, interest, taxes, and other costs from its revenue. For venture-backed startups, Net Income is negative in the early years. Net Income is sometimes called the “bottom line” because it appears as the last line on the income statement and serves as the most comprehensive measure of a company’s profitability.

Non-GAAP Metrics

Non-GAAP metrics are financial measures that companies use alongside traditional accounting metrics to better reflect their business performance. VC-backed startups have specific non-GAAP metrics, such as Annual Recurring Revenue (ARR), which shows the predictable yearly revenue from subscriptions; Monthly Recurring Revenue (MRR), which tracks subscription revenue on a monthly basis; Gross Merchandise Value (GMV), which represents the total value of goods sold through a platform; and Customer Acquisition Cost (CAC) payback, which measures how many months it takes to recover the cost of acquiring a customer. While these metrics aren’t recognized under standard accounting rules, they often provide investors with crucial insights into a startup’s growth trajectory and unit economics.

Overhead

Overhead refers to the ongoing operational costs of running a startup that are not directly tied to producing or delivering its product or service. This includes expenses like office rent, administrative salaries, software subscriptions, and utilities. While venture-backed startups often have high overhead costs in their early stages due to investments in infrastructure and talent, investors eventually expect to see overhead growing more slowly than revenue as the business scales.

PEO (Professional Employer Organization)

A professional employer organization is a full-service human resource outsourcing company that enters into a co-employment arrangement with a company, and performs employee administration tasks like payroll and benefits administration.

Pitch deck

A pitch deck is a comprehensive presentation of your business model, targeted at venture capitalists, angel investors, lenders, and other sources of capital. 

Preferred stock

Preferred stock gives the stockholders a priority claim whenever a company distributes assets to shareholders or pays dividends. The exact terms of the preference can differ from company to company.

Pre-seed round

This is the time period during which a startup’s founders are just beginning operations, and it’s often funded by founders themselves, friends, or family members. 

Primary shares

Primary shares of stock are newly issued, and investors buy them directly from a startup company. When the startup sells primary shares, those funds go to the company and help to fund company operations.

Pro rata

Pro rata rights in startup investing allow existing investors to maintain their ownership percentage in a company during subsequent funding rounds. These rights give investors the option, but not the obligation, to participate in future financing rounds by purchasing additional shares proportional to their current stake. By exercising pro rata rights, early investors can prevent dilution of their ownership as the startup raises more capital, potentially allowing them to benefit from the company’s growth and success over time.

Reconciliation

Reconciliation in accounting is the process of comparing and verifying two sets of financial records to ensure they match and accurately reflect a company’s financial position. This crucial practice involves identifying and resolving any discrepancies between different financial statements, such as bank statements and internal records, or between subsidiary ledgers and the general ledger. By performing regular reconciliations, businesses can detect errors, prevent fraud, and maintain the integrity of their financial reporting, ultimately ensuring compliance with accounting standards and providing stakeholders with reliable financial information.

Research and development (R&D) tax credit

The R&D tax credit is a government tax incentive provided to companies who improve a product or process, and provides a dollar-for-dollar cahs savings to companies that invest in innovation and product development.

Rule of 40

The Rule of 40 is a metric that SaaS investors use to evaluate the performance and potential of a mid-stage to late-stage SaaS startup. This rule does not produce helpful results for a very early-stage SaaS startup, because most early-stage startups have high operating expenses and have not yet started generating meaningful amounts of revenue. The formula for the Rule of 40 is adding the company’s annual growth rate to its profit margin (expressed as a percentage), with the goal of having a result that is over 40.

Runway

The length of time that a company can continue to operate using its current cash reserves, based on the company’s burn rate, which is monthly or weekly spending.

SaaS (software as a service)

SaaS allows customers to connect and use a cloud-based applications over the Internet. Customers pay for a software license which allows them to access software that is located on external servers.

Sales tax

Sales tax is a tax imposed by federal, state, and/or local governments on the sale of goods and services. A 2018 Supreme Court decision determined that companies establish tax nexus and can be charged taxes by states if they sell products or services in that state, even if they have no physical presence. Sales tax laws vary by state, so startups need to carefully evaluate any sales tax responsibility. 

Section 382

A part of the IRS tax codet that limits corporations’ use of net operating losses to offset profits. 

Seed round

A seed round is an early capital funding round that raises money to launch a startup. While seed capital oten comes from the company founders’ personal assets, friends, family, or angel investors, there are also seed funds that are managed by professional venture capitalists.

Series B

Series B companies have proven they are ready for success by having substantial success and they are ready to expand their market reach. Series B investments normally range from $25-$50 million. 

SGA expenses

Selling, General and Administrative (SG&A) expenses are the costs a company incurs to promote, sell, and deliver its products and services, as well as to manage day-to-day operations, excluding direct production costs. These expenses typically include items such as rent, utilities, salaries of non-production staff, marketing and advertising costs, office supplies, and other overhead expenses that are not directly tied to creating goods or services. SG&A expenses are reported on a company’s income statement and are crucial for understanding a business’s operational efficiency and profitability, as they represent the overhead costs that must be covered before a company can generate a profit.

Single-entry bookkeeping

With single-entry bookkeeping, each transaction is recorded with a single entry into the company’s financial records, and basically tracks incoming and outgoing cash, much like a checkbook ledger. 

Startup

Startups are new companies in the early stages of operation. Startups are typically funded by company founders or external investors, because they have high costs and limited revenue. 

Target company

A company that’s being considered for investment by a venture capital firm or angel investor.

Tax deduction

Tax deductions reduce the adjusted gross income of a taxpayer, and can reduce the tax liability of a business or person. 

Tax nexus

“Nexus” is the required level of connection between a taxpaying entity and a taxing jurisdiction that allows the jurisdiction to collect taxes. Different states have different requirements that establish tax nexus, including dollar amount of sales or total number of sales.

Transfer Pricing

Transfer pricing refers to the pricing of transactions between different entities within the same company group, particularly across international borders. Most startups do not have to worry about transfer pricing, but for companies with international subsidiaries or parent companies, transfer pricing becomes important when moving goods, services, intellectual property, or funds between entities. Due to complex tax regulations and scrutiny from tax authorities, venture-backed startups often need to hire specialized firms to analyze and document their transfer pricing strategies to ensure compliance and defend against potential audits.

Treasury

Treasury in a venture-backed startup refers to the management of the company’s cash and investments. While early-stage startups might keep funds in basic bank accounts, as cash reserves grow, sophisticated and safe treasury management becomes a meaningful factor for reducing burn rate. A well-managed treasury function can generate meaningful yield through strategic investments in instruments like government money market funds, treasury bills, and other low-risk securities, effectively extending the startup’s runway without requiring additional fundraising. However, startups must balance potential returns against the need to maintain sufficient liquidity for operations and growth initiatives - and always take into account safety. Founders should also be careful not to accidentally choose treasury investments that jeopardize QSBS.

Unicorn

A company with a valuation of over $1 billion. This occur more often in the software or technology sectors.

Unit Economics

Unit economics measures the profitability of a startup on a per-unit basis, typically calculated as revenue minus costs for a single customer or transaction. For venture-backed startups, strong unit economics indicate that the core business model is sound and can become profitable at scale, even if the company is currently operating at a loss due to growth investments. Many startups have poor unit economics when they first start out, but the best founders produce products that will quickly achieve attractive unit economics.

Value proposition

A value proposition is the unique selling proposition (USP) that makes a business attractive to specific customers and investors.

VC fund capital call

A VC fund capital call is a formal request made by the fund manager to its limited partners (investors) to contribute a portion of their committed capital. These calls are typically issued when the fund needs to make new investments in startups or cover operational expenses, allowing the fund to draw capital as needed rather than holding all committed funds upfront. Capital calls are legally binding obligations outlined in the fund’s partnership agreement, usually giving investors a 10-30 day window to transfer the requested funds, and they help minimize cash drag while enabling the fund to remain agile in pursuing investment opportunities.

Venture capital fund reserves

Most venture capital funds maintain 30-40% of the fund in reserve, while the other 60-70% is used to fund new startups. Reserve funds are typically used to support the fund’s portfolio companies if those startups are doing well or need additional capital to reach a milestone.

Venture debt

Venture debt is loans offered by banks or other lenders that are designed for startups and early-stage companies that have already received venture capital funding. 

Zero cash date

Also known as the cash out date, the zero cash date is the day that a startup runs out of money unless the company obtains additional funding.

Warrants

Warrants give the holder the right to buy a company’s stock at a specific price within a set time period, in a concept not dissimilar to stock options. In venture-backed startups, warrants are often issued to investors as deal sweeteners during fundraising rounds, to lenders as part of debt financing packages, to strategic partners, or to key advisors. Unlike stock options (which are typically issued to employees), warrants are usually given to outside parties (including advisors) and can become valuable if the company’s stock price rises above the warrant’s exercise price. Venture investors pay close attention to outstanding warrants as they can impact future ownership dilution. It is very important to track warrants correctly and accurately, as they represent legitimate possible stock holders - so use a cap table software to track warrants correctly.