The cap table provides the information on who owns how much of the company before and after the investment rounds.

Let us take an example here:

1 million shares held by founders before investment

$20M pre-money valuation

$5M investment

Hence, the post-money valuation is $25M, and hence the VC firm owns 20% of the company ($5M/$25M) and the founders own 80%.

Now let’s complicate it further. We have an ESOP pool of 10% on a post-money basis. This means that after the investment, we will have this 20% pool. The post-money valuation remains the same, however, the ownership of the founders will change now to 70%.

Since this 70% represents the 1M shares held by the founders, we would be able to calculate the total shares outstanding and the number of shares for the ESOP pool and investors. Since we now know the number of shares held by the investors and the valuation, we can calculate the price per share of preferred stock.