Investment = The amount of money the Investor contributed with a SAFE. This number should be stated in the legal document and equate to the amount of cash you received.
Accrued Interest = Only Applies if there's an interest rate, usually on a convertible note. This is the amount of interest that has accumulated.
Conversion Price = The lower of the SAFE Price and Share Price Paid by Investors in the Priced Round
SAFE Price = Valuation Cap / Capitalization of the Company
Valuation Cap = Described above and will be found in the legal documents
Capitalization of the Company = All Shares Issued + All Shares Authorized Under the Stock Option Plan + All other promised shares
All shares issued = the shares issued outside of the stock option plan, usually that includes founders, advisors, and anyone else who has been formally issued shares but not under the umbrella of the stock option plan which is counted separately
All Shares Authorized Under the Employee Stock Option Plan (“ESOP”) = Most companies will have an ESOP, especially modern startups. If you don’t, you can enter zero for this, but your investors will likely require you to get one to ensure you can attract talent. You want to count every share authorized, not just the ones already granted to employees because the assumption is that eventually all the shares authorized will be allocated to employees. You can find this number in your ESOP documents.
Think of the Capitalization as the sum of all shares of the company. The point here is to account for everyone in the company, including all the shares that are reserved for future employees under your stock option plan, if you have one. By doing this, you ensure that you’re accounting for the entire ownership of the company when you run the calculations.
All other promised shares = any shares that you may have promised but have yet to issue that wasn’t counted above. This is a catch all for all the other promised shares to ensure that the entire ownership of the company is represented.
Share Price paid by Investors in the Funding Round = this is the price that the new investors are paying for shares in the new funding round. Unless, it’s a “down round” where the value is below the valuation cap, you will likely not use this number as it will be higher than the SAFE price and the equation requires the lower of the two.