Convertible Note Calculator Excel Template (Excel XLSX)

VALUATION MODEL EXAMPLE EXCEL DESCRIPTION

This product (Convertible Note Calculator Excel Template) is an Excel template (XLSX), which you can download immediately upon purchase.

Startup Companies Raise outside funding to run the business operations and for growth from different investors, including angel investors, traditional venture capitalists, friends, family and high-end investors. But no one would like to invest in a company with no great pitch or valuation; hence, Startups now frequently use convertible notes to raise money. This Convertible Note Calculator Excel Template is beneficial if you want to know the cap table before and after conversion.

A convertible note is a short-term debt that has the provision to change into equity at a later date. So initially, it is structurally debt. Still, later on, it becomes an equity investment when the note holder gets his shares for the accrued interest and principal amount based on the agreed-upon valuation Cap and Discount rate. Investors go for Convertible Notes because they believe the business will grow. Hence, their equity in the startup will be greater than the debt's interest.

Why startups go for convertible notes.
They are simple and fast. The startups get funding very quickly through notes only.
For issuing convertible notes, there is no need of valuation. However, for a round of funding, the startup needs to have a valuation done which is complicated at the very beginning of the business.
Convertible loans contain a valuation Cap which puts an upper limit at which the investment will convert into equity. This guarantees that the startup doesn't give much of its stake at a low price.
Sheets of the Convertible Note Calculator Excel Template
1. Instructions
The sheet contains information about convertible notes, when and why startups should use them and how to use the template.
Assumptions
The assumptions columns are highlighted with peach fill, which you must enter according to your startup data, and the calculator will calculate the cap table automatically.
Cap Table Pre-Seed Funding
You don't have to enter anything in this sheet. The sheet calculates the pre-seed cap table from the assumption you will enter in the assumption sheet.
Cap Table Post-seed funding
The sheet calculates the equity amount, no of shares, ownership % and the change in ownership from pre-seed funding for all the shareholders.

5. Dashboard
The dashboard is a graphical representation. It includes the graphs of components of the cap table pre-seed and Post-seed and valuation.

Benefits of using the Convertible Note Calculator Excel Template
The Convertible Note Calculator does not require much time, so you can utilize your time in your startup operations and other work.
The Convertible Note Calculator is made after thorough research, so it generates accurate results.
The calculator is cost-effective; you do not need an expensive financial expert for convertible note calculations.
The calculator calculations are linked; you don't have to create any formula, you have to enter your startup-specific data in the peach-filled column, and the calculation will update automatically.

The template includes detailed pre-seed and post-seed funding cap tables, ensuring clarity on equity distribution. The dashboard provides visual insights into ownership breakdowns and valuation changes, aiding strategic decision-making.

Source: Best Practices in Valuation Model Example, Entrepreneurship, Financing Excel: Convertible Note Calculator Excel Template Excel (XLSX) Spreadsheet, Oak Business Consultant