Team, Org Model & Equity
PropChain's organizational structure is designed around an equity-first, milestone-gated hiring model that preserves a 24-month Seed runway while building a high-leverage team. This approach balances disciplined capital deployment with the technical depth required to deliver Terra Engine, CurbScan/Terra Net, and our predictive real estate platform.
Org Chart & Hiring Plan Overview
This comprehensive plan describes PropChain's current team, equity-first contractor model, and milestone-gated hiring roadmap over the 24-month Seed runway. It aligns with our $1.4M Seed SAFE target (YC post-money; $15M cap, 20% discount) and $900k headcount envelope over 24 months.
Low Burn
$45k monthly baseline protecting maximum runway
Base Burn
$58–61k monthly target scenario
High Burn
$80k monthly with accelerated hiring
The plan ensures runway protection, disciplined sequencing, and flexibility for upside acceleration while maintaining our equity-first structure for DS/MLE, FSMAD, Digital Marketing Lead, and ETL Data Engineer roles.
Current Organization Structure
As of Seed Round Opening
Founder & CEO
Product leadership, infrastructure strategy, FP&A, GTM, capital raising, and roadmap ownership. Cash plus majority equity.
DS/MLE
Terra Engine, valuation models, predictive pipelines. Warrant-heavy with optional cash activation.
FSMAD
Mobile app, admin dashboards, backend APIs. Warrant-heavy with optional cash activation.
UI/UX Designer
Design system, user flows, UX research. Hourly or project-based compensation.
This structure reflects our historical spend allocation: approximately 92% in R&D, product development, and design—demonstrating our commitment to building world-class predictive infrastructure before scaling GTM.
Seed-Stage Target Organization
At $1.4M Raise Completion
The Seed-stage org is intentionally lean, cross-functional, and equity-first, with hiring carefully gated by product milestones and GTM traction. This structure supports our ambitious technical roadmap while preserving 22–24 months of runway.
Key Principle: Every hire is milestone-gated and tied to specific product or revenue KPIs. No premature scaling that could compress our runway.
24-Month Hiring Roadmap
Our hiring plan strictly adheres to the $900k headcount budget with KPI-based activation gates. Each role is sequenced according to roadmap dependencies for Terra Engine, CurbScan/Terra Net ingestion, and GTM rollout.
1
Months 0–3: Foundation
Core team operational. Rig 1 assembly and calibration. MLS ingest setup begins. No new hires—conserve burn.
2
Months 3–6: Operationalization
Hire Business Ops/PM. Engage ETL Data Engineer (contract). Expand MLS ingestion and Terra Net pipelines.
3
Months 6–10: Engineering Scale
Add 2nd Engineer. Feature velocity increases for Terra Engine and UX improvements. Terra Net ingestion scales.
4
Months 10–18: GTM Activation Tier 1
Conditional DML cash activation. Structured demand generation begins. Hire Sales/CS once KPIs hit.
5
Months 15–24: GTM Tier 2 & Expansion
If raise ≥$1.6M or strong revenue: hire 3rd Engineer. Expand into Phase B/C scanning markets.
Detailed Hiring Plan
Sequenced & KPI-Gated Roles
Business Operations / Project Manager
Months 3–6 Hire
Purpose & Drivers
Provide operational glue across engineering, pilots, MLS integrations, and GTM. Rapid infrastructure buildout and heavy scheduling plus compliance load for MLS-based pilots drive this early hire.
Core Responsibilities
- Cross-functional project management
- MLS onboarding workflows and data governance compliance
- Timeline and release cycle coordination
- Founder load lightening across ops and vendor management
Critical Timing
Must be hired early to protect burn efficiency and engineer throughput. This role prevents bottlenecks as we scale MLS partnerships and pilot programs.
ETL Data Engineer
Months 4–9 Contract Role
Purpose
Build and maintain data ingestion pipelines: MLS, telemetry, CurbScan, Terra Net. Essential for RESO-compliant ingestion and ML training pipelines.
Key Drivers
RESO-compliant ingestion, LISTHub/Trestle/MLS Grid pipelines, CurbScan geo-tagged ingestion and reverse geocoding, ML training pipeline normalization.
Compensation
Equity-first: up to 2,000 NV units with no base cash. Dependency: Rig #1 goes live early; MLS ingestion begins.
Second Engineer
Months 6–10 Full-Time Hire
Purpose & Timing
Accelerate backend, infrastructure, ingestion, and release cycles. Critical for handling CurbScan Phases A/B data volume and pipeline complexity identified in technical roadmap.
Expected Stack
- Node/Python/ML ops
- AKS + NAS hybrid infrastructure
- Mobile backend integration
- Data pipeline optimization
Impact
Reduces founder and contractor bottlenecks while enabling parallel development streams. Essential for maintaining velocity as product complexity increases.
This hire directly supports our ability to scale from 1 to 2–3 CurbScan rigs while maintaining sub-5s inference latency.
Digital Marketing Lead
Equity-First, KPI-Gated Cash Activation
Build structured experiments, content engine, and conversion funnels. This role is critical for scaling from pilots to sustainable user acquisition, but activation is strictly gated to protect runway.
01
Initial Structure
Warrant-only compensation (≤2,000 units). No cash burn until KPI gates are met.
02
Activation Conditions
≥2 Alpha/Beta pilots with weekly active users, ≥1,000 MAUs (freemium), 3 validated trigger events → conversion.
03
Cash Ramp
Optional cash component unlocked only after KPIs demonstrate early unit economics validation.
This structure ensures we don't invest in demand generation before we've proven product-market fit and conversion mechanics.
Sales & Customer Success
Months 12–18 Conditional Hire
Purpose
Convert B2C/B2B pipeline into revenue, manage pilots, and maintain retention. This role transforms early traction into sustainable ARR growth.
Strict KPI Gates
- ≥10 paying accounts OR ≥25 paying seats
- Pipeline ≥$200k ACV
- NRR ≥100% on early cohorts
Runway Protection
Critical: Must not be activated prematurely. This hire represents a significant cash commitment and should only occur once we've demonstrated repeatable conversion patterns.
Third Engineer (Conditional)
Months 15–20, Only at $1.6M Raise
Authorization Criteria
Raise ≥$1.6M OR substantial traction plus revenue demonstrating need to support 2–3 CurbScan rigs (Phases B/C).
Focus Areas
Automation systems, data quality assurance, advanced Terra Engine work, and multi-rig coordination infrastructure.
Strategic Value
Enables geographic expansion into FL/TX markets and supports scaling to 3+ simultaneous scanning operations.
Organizational Evolution Timeline
1
Months 0–3
Foundation phase. Core team operational. Rig 1 assembly. MLS ingest begins. Zero new hires.
2
Months 3–6
Operationalization. Add Business Ops/PM and ETL Data Engineer. Scale MLS ingestion.
3
Months 6–10
Engineering scale-up. 2nd Engineer joins. Feature velocity increases significantly.
4
Months 10–18
GTM Tier 1. DML cash activation. Sales/CS hire. Commercial conversions begin.
5
Months 15–24
GTM Tier 2. Optional 3rd Engineer. Phase B/C market expansion.
Budget Alignment
$900,000 Headcount Envelope
This allocation ties directly to our Seed Use-of-Funds and maintains strict discipline around the $900k headcount budget. Contractor allocation (22–25%) reflects our equity-first model with variable cash activation based on milestone achievement.
Risk Management & Mitigations
Risk: Premature Hiring
Mitigation: KPI gating enforced. Reserve preserved at $1.4M. No early cash activation for DML/ETL roles.
Risk: Scanning Load
Mitigation: 2nd Engineer by Month 10. Optional 3rd only at $1.6M raise or proven revenue.
Risk: MLS Delays
Mitigation: Business Ops/PM hired early. Standardized RESO workflows implemented.
Risk: GTM Underperformance
Mitigation: DML cash withheld until KPIs met. Sales/CS delayed accordingly.
Red Flags for Investor Review
Critical Items Requiring Attention
- Hiring Discipline: Any deviation from KPI-gated hiring could materially shorten runway from 24 to 18 months or less
- Raise Size Impact: If raise < $1.2M, 2nd engineer may be pushed back 3–5 months, affecting product velocity
- CurbScan Scaling: Aggressive 3-rig program significantly increases engineering and PM load beyond base plan
- IP Assignment: Warrant-heavy contractor compensation requires locked IP assignment (addressed in Docs 2.4 & 6.3)
- Contractor Concentration: Heavy reliance on equity-first contractors creates execution risk if key contributors depart
Key Team Biographies
Leadership & Core Contributors
PropChain's team combines deep expertise in fintech, real estate, machine learning, and full-stack development. Our equity-first model attracts world-class talent while preserving runway, with each contributor bringing specialized skills essential to our predictive real estate vision.
Founder & CEO
Strategic leadership, product vision, capital markets, and FP&A expertise from fintech IPO and Web3 infrastructure experience.
Data Science / ML Engineer
Terra Engine architect responsible for predictive models, embeddings, and performance-optimized inference pipelines.
Full-Stack / Mobile Engineer
Platform architect building iOS/Android apps and backend services that bring Terra Engine predictions to life.
Kevin Sonnet
Founder & Chief Executive Officer
Kevin Sonnet is the Founder and CEO of PropChain, responsible for overall company strategy, fundraising, product direction, and key commercial relationships with MLSs, brokerages, data aggregators, and strategic partners. He is the primary architect of PropChain's predictive real estate vision and Seed capital plan.
Core Responsibilities
- Strategic and financial planning, including Seed FP&A, runway modeling, and headcount alignment
- System-level product and technical direction across Terra Engine, Terra Net/CurbScan, and hybrid infrastructure
- Capital markets, investor relations, and comprehensive data room preparation
- Founder-level GTM with MLSs, brokerages, and pro users
Unique Background
Blended expertise in fintech, capital markets, FP&A, and real estate transactions—unusually well-matched to PropChain's predictive real estate and embedded-finance roadmap.
Kevin's Professional Background
1
Near Inc (Pagoda) – Senior Corporate Finance Manager, FP&A
Established FP&A function at venture-funded Web3 infrastructure company. Built multi-year operating and treasury models across fiat and token treasuries.
2
Near Inc (Pagoda) – Senior Business Operations Manager
Managed cross-functional strategic initiatives. Owned ~$35M annual fiat budget and ~$50M token treasury with integrated forecasting framework.
3
Coinbase – Risk & Compliance Consultant
Designed scalable enterprise compliance framework ahead of Coinbase IPO, including standardized analytics for executive and regulatory stakeholders.
4
JPMorgan Chase – Associate Vice President
Led capital planning and analytics using mathematical programming and KPI-driven reporting to optimize allocation and improve forecasting accuracy.
Kevin's Achievements at PropChain
Capital Architecture
Designed $1.0–1.6M YC-style post-money SAFE at $15M cap, integrated with 24-month planning horizon and explicit burn ranges across $900k headcount envelope.
Technical Leadership
Championed NAS-first, Azure-when-needed architecture and edge-based Terra Net approach, enabling sub-5s latency in Summit, NJ scanning operations.
Product Vision
Owns cross-functional roadmap for Terra Engine predictive models and their expression in mobile/dashboard UX, supervising Beta testing and workflow design.
Strategic GTM
Developed Christie's International Real Estate demo weaving predictive valuation, curb/reno insights, and client-ready reporting into compelling narrative.
Kevin's combination of institutional finance, Web3/fintech, compliance, and analytics experience underpins PropChain's ability to execute a disciplined Seed round while building ambitious predictive infrastructure within a constrained, high-leverage team model.
Janmesh
Data Science / ML Engineer
Role & Expertise
Janmesh serves as PropChain's Data Science / ML Engineer under a warrant-heavy, equity-first contractor structure. He designs and implements Terra Engine's ML models, including predictive valuation, price trajectory, trend phase detection, and curb-condition inference.
Core Focus Areas
- Applied ML for real estate pricing, renovation ROI, and neighborhood risk modeling
- Embeddings and feature engineering over MLS, curb-scan, and geospatial datasets
- Training pipelines respecting MLS licensing and data-retention rules
- Performance-sensitive inference for edge devices and cloud
Key Achievements
Co-designed first end-to-end Terra Engine prototypes used in Summit, NJ scanning and pilot environments, supporting live predictive experiences in mobile app and dashboards.
Collaborated with full-stack engineer to define stable JSON contracts and API payloads between ML services and app backend, including Christie's "Medium demo" hero flows.
Validated that Terra Engine models scale within Seed infrastructure envelope and scanning economics across 1–3 rig scenarios.
Andrew
Full-Stack / Mobile Engineer (FSMAD)
Role & Scope
Andrew is PropChain's Full-Stack / Mobile Engineer, engaged under a warrant-heavy, equity-first contractor arrangement. He functions as lead platform architect for the mobile app and key backend services.
Technical Responsibilities
- Architecting iOS/Android predictive search application with map/list toggle, polygon drawing, and filter sheets
- Integrating backend APIs with Terra Engine ML endpoints
- Contributing to hybrid infrastructure by wiring app-level data flows
- Ensuring predictive cards and charts render quickly under realistic network conditions
Notable Achievements
Delivered core mobile experience used in investor and partner demos, including Christie's-focused "Medium" demo with visible AI at each step.
Implemented production-grade backend integrations supporting live scanning in Summit, NJ with sub-5s inference and robust UX over hybrid pipeline.
Collaborated closely with Founder and DS/MLE to translate roadmap milestones into shippable increments aligned with Seed runway.
Planned Milestone-Gated Hires
Seed Horizon Team Expansion
Several additional roles will be hired as milestones are met and KPI gates are satisfied, funded within the $900k headcount envelope. These roles are explicitly designed to preserve 22–24 months of base-case runway at a $1.4M raise.
01
Business Ops / PM
Coordinate cross-functional execution across product, engineering, GTM, and finance. Activated once multiple Alpha/Beta pilots are live.
02
Digital Marketing Lead
Own freemium funnel and paid acquisition. Initially warrant-only, cash activation after hitting 1k MAUs and conversion triggers.
03
ETL / Data Engineer
MLS and curb-scan data ingestion. Warrant-first structure timed with Terra Net and CurbScan milestones.
04
Sales & CS Lead
Convert pilots into durable ARR. Activated at ≥10 paying accounts or ≥25 seats with ≥$200k ACV pipeline.
Business Operations / PM Profile
Planned Early-Stage Hire
Expected Background
- Product or operations experience at early-stage SaaS/analytics or proptech company
- Comfortable with requirements gathering, user testing, sprint planning, and KPI dashboards
- Able to translate market feedback into prioritized product work and GTM experiments
- Strong quantitative and communication skills for FP&A partnership
Core Responsibilities
Partner with Founder on capital allocation and investor reporting while coordinating execution across all functional areas.
Milestone Gate
Activated once multiple Alpha/Beta pilots are live, predictive app has demonstrable weekly active usage, and company transitions from build-heavy to scale-oriented execution.
Digital Marketing Lead Profile
Warrant-First GTM Role
1
Expected Profile
Performance and content marketer with prior experience launching SaaS or marketplace products. Confident with KPI-gated budget deployment and multi-channel funnels.
2
Compensation Structure
Initially warrant-only (up to 2,000 Common NV units) with potential partial cash activation from reserve once KPI gates achieved.
3
KPI Triggers
≥2 Alpha/Beta pilots with consistent usage, ≥1,000 monthly active free users, and 3+ validated conversion triggers before any cash activation.
ETL / Data Engineer Profile
Warrant-First Infrastructure Role
Expected Background
- Experience building data pipelines on modern stacks (Azure Data Lake, SQL/NoSQL, streaming/ETL frameworks)
- Comfortable with RESO 1.6+ schemas, per-MLS transforms, and licensing constraints
- Familiar with geospatial datasets, curb-scan telemetry, and ML workflow performance tuning
Compensation & Timing
Dedicated contractor with no base cash initially and up to 2,000 warrants. Activation timed with Terra Net and CurbScan milestones, including first production rig in NJ and subsequent rig additions.
Sales & Customer Success Profile
Revenue Conversion Specialist
Expected Background
B2B SaaS or proptech sales experience, ideally selling to MLSs, brokerages, or adjacent verticals. Comfortable managing small but high-value pipeline.
Core Competencies
Advisory-style selling and early-stage customer success including onboarding, feature feedback, and renewal design.
Strict Activation Gate
≥10 paying accounts or ≥25 paying seats, rolling pipeline of ≥$200k ACV across three qualified opportunities, and NRR ≥100% on early cohorts.
Team Alignment with Capital Plan
$900k
Headcount Envelope
Total 24-month budget for all compensation at $1.4M raise
22-24
Runway Months
Protected timeline at base burn with equity-first structure
5-7
Core Team Size
Lean, high-leverage team through Seed horizon
The team structure and planned hires are explicitly aligned with our equity-first contractor model, KPI-gated activation of GTM and Sales/CS headcount, and the need to reach Alpha/Beta with early revenue positioning for Series A—all without over-hiring ahead of validated demand.
Critical Red Flags
Items for Reviewer Attention
Contractor Structure Risk
DS/MLE and FSMAD engaged under warrant-heavy models. Execution risk on small contributor base. Mitigation: Confirm robust IP assignment and confidentiality terms, verify vesting aligns with roadmap.
Unfilled Planned Roles
Business Ops/PM, Sales & CS, DML cash component, ETL/Data Engineer remain planned. Review: Confirm current core team capacity sufficient to reach activation gates.
Biographical Detail
Document focuses on roles and expertise rather than exhaustive CV details. Action: Detailed CVs or LinkedIn profiles available upon request for later-stage diligence.
Founder Key-Person Risk
Kevin spans product, infrastructure, GTM, and investor relations. Mitigation: Business Ops/PM and Sales/CS hiring timing becomes particularly important.
Contractor & Employment Agreements
Legal Framework Overview
This section contains the standard contractor, employment, and IP agreements used by PropChain LLC for all core service providers. All agreements explicitly incorporate the Capital Plan v1.1 and Modeling Assumptions in Appendix A.
Equity-First Compensation
Engineering and GTM roles structured with warrant-heavy compensation, minimal initial payroll footprint.
Warrant Structures
Cash activation only after KPI gates for Digital Marketing Lead and ETL Data Engineer roles.
IP Protection
Clear IP assignment and work-for-hire protections for all code, models, datasets, telemetry processing, and software.
Equity & Warrant Schedule
Complete Service-Based Equity Summary
This schedule provides a complete, investor-oriented summary of all service-based equity and warrant instruments issued or committed by PropChain prior to and through the Seed SAFE round. It reconciles all current fully-diluted awards, warrant-based arrangements, vesting schedules, and IP terms.
Important: This document does not include a future employee option pool, which will be created in connection with the first priced round (Series A). See Employee Option Pool Plan for details.
Equity Schedule Principles
01
Governing Documents
Capital Plan v1.1 (governing), Appendix A (binding), Seed-round rules with $15M post-money SAFE cap and 20% discount.
02
Structural Rules
Service-provider equity is warrant-based, not unit grants. Founder maintains 80–90% of pre-money FD ownership.
03
Equity-First Roles
Digital Marketing Lead and ETL Data Engineer are warrant-only with up to 2,000 NV Common units each. DS/MLE and FSMAD have warrant-heavy terms with optional cash activation.
Pre-Money Cap Table
Fully-Diluted Equity & Warrant Schedule
Total Pre-SAFE FD Units: ~90,500 | Founder ownership: ~88–89% FD | Service provider ownership: ~8–10% FD
Detailed Warrant Schedules
By Contributor
1
DS/MLE Warrant
Units: 3,000 Common NV | FD%: ~3.0% | Vesting: 4 years, 1-year cliff (25%), monthly thereafter | Milestones: Terra Engine V1, PropPredict pipeline, ETL integration | IP: Full assignment to PropChain
2
FSMAD Warrant
Units: 2,500 Common NV | FD%: ~2.5% | Vesting: 4 years, 6-month cliff | Acceleration: Up to 10% for Alpha/Beta milestones | Deliverables: End-to-end mobile architecture, Terra Engine integration
3
Digital Marketing Lead
Units: Up to 2,000 NV | FD%: ~1–2% | Structure: Equity-first, no cash unless KPI-gated | Vesting: 3-year, 3-month cliff | Triggers: ≥2 pilots, ≥1k MAU, conversion events
4
ETL Data Engineer
Units: Up to 2,000 NV | FD%: ~1–2% | Vesting: 3 years, milestone-sequenced | Milestones: MLS ingestion, Terra Net pipeline, feature store operationalization
DS/MLE Warrant Details
Instrument Structure
Service Provider Warrant to purchase 3,000 Common NV Units representing approximately 3.0% fully diluted pre-SAFE ownership.
Vesting Schedule
- 4-year total vesting period
- 1-year cliff (25% vests at 12 months)
- Remainder vests monthly over 36 months
- No automatic acceleration at SAFE conversion
Performance Milestones
- Completion of Terra Engine V1 (predictive core)
- Delivery of PropPredict modeling pipeline
- ETL integration across MLS + Terra Net ingestion
IP & Confidentiality
Full IP assignment to PropChain, NDA + non-solicit, no model reuse without written consent. Optional cash compensation post-Seed activation funded from reserve.
FSMAD Warrant Details
Instrument Structure
Service Provider Warrant to purchase 2,500 Common NV Units representing approximately 2.5% fully diluted pre-SAFE ownership.
Vesting & Acceleration
- 4-year vesting period
- 6-month cliff
- Milestone-based acceleration up to 10%:
- Alpha mobile app feature-complete
- Beta release on iOS/Android
Key Deliverables
- End-to-end mobile architecture
- Terra Engine integration into user flows
- Predictive search interface
- Map/list toggle and polygon drawing
IP Assignment
Full assignment with exclusive ownership to PropChain for all code, designs, and technical documentation.
Digital Marketing Lead Warrant
1
Warrant Structure
Up to 2,000 NV Common Units (~1–2% FD). Equity-first with no cash unless KPI-gated activation occurs.
2
Vesting Terms
3-year vesting, 3-month cliff, monthly thereafter. All campaign IP (ads, creative, performance assets) assigned to PropChain.
3
KPI Triggers
For tranche allocation and any optional cash: ≥2 Alpha/Beta MLS pilots with weekly active usage, ≥1,000 MAU on freemium app, defined conversion events.
ETL Data Engineer Warrant
Warrant Terms
Service Provider Warrant for up to 2,000 NV Common Units representing approximately 1–2% fully diluted ownership.
Vesting Structure
3-year vesting with milestone-sequenced tranches tied to:
- MLS ingestion pipeline completion (ListHub/RESO mapping)
- Terra Net ingestion pipeline for CurbScan telemetry
- Feature store / data mart operationalization
Compensation Notes
No recurring cash compensation in Seed plan. Activates only when data ingestion is critical for Terra Engine and pilot execution.
This structure aligns upside to long-term data asset value while preserving runway for core product development.
Other Advisors & Contributors
Advisory Warrants totaling ≤1,000 NV units across all contributors, representing less than 1% fully diluted ownership. Typically structured with 2-year vesting, quarterly or milestone-based, with standard IP assignment and confidentiality.
Industry Advisors
MLS regulatory guidance, proptech GTM strategy, and market access expertise from experienced real estate professionals.
Technical Advisors
ML/infrastructure optimization, cloud architecture review, and performance tuning guidance from specialized engineers.
Vesting Mechanics & Governance
Standard Vesting
Service-based vesting with monthly prorating after cliff. Vesting does not accelerate automatically at SAFE conversion. Any acceleration requires board/manager approval at priced round.
Termination Rules
Unvested units on termination revert to company. All warrants priced at FMV determined by 409A or equivalent valuation.
IP & Confidentiality
All agreements include full IP assignment, NDA & non-solicit, derivative work assignment, and no external model training using PropChain datasets.
Tax & Exercise
Exercise price set at FMV at grant. Warrants become exercisable upon vesting. Exercise windows typically 10 years from grant.
Pre-Money Cap Table Reconciliation
This distribution is consistent with Appendix A requirements: Founder maintains 80–90% pre-money ownership, service providers represent 5–10%, and no ESOP exists until priced round. Total FD units: approximately 90,500.
SAFE Round Interaction
SAFE investors convert on the post-money cap ($15M). Service provider warrants do not dilute SAFE investors at conversion—SAFE dilution applies only to the existing FD pre-money base.
9.3%
SAFE Ownership
At $1.4M target raise
80-82%
Founder Post-SAFE
Maintains majority control
7-9%
Service Providers
Combined post-SAFE ownership
Critical Red Flags: Equity Schedule
Required Investor Review Items
- Unit Count Alignment: Final unit counts must be aligned with operating agreement and warrant forms—investors should review signature-ready versions
- Milestone Tracking: Service provider milestones must be tracked to avoid accidental acceleration or vesting disputes
- ESOP Timing: No ESOP currently exists; must be created at priced round and will dilute SAFE + all pre-money holders
- IP Execution: Ensure IP assignments are fully executed for DS/MLE, FSMAD, Digital Marketing Lead, and ETL Data Engineer
- Founder Concentration: Founder equity concentration is high but intentional, consistent with Capital Plan and market norms for deep-tech early Seed
Capitalization Table & SAFE Conversion
Current Cap Structure & Pro Forma Scenarios
This document presents PropChain's current capitalization, outstanding service-provider warrants, and pro forma SAFE ownership outcomes at each Seed raise size: $1.0M, $1.2M, $1.4M (target), and $1.6M (hard cap).
SAFE Framework
YC post-money SAFE with $15M cap, 20% discount, MFN, and pro-rata rights for investors ≥$100k
Series A Example
Required conversion example including pro-rata rights mechanics and post-conversion ownership
Documentation Hierarchy
Capital Plan v1.1 governs, then Appendix A, then financials, roadmap, wiki, and deck
Current Pre-Seed Capitalization
No Outside Investors
PropChain has no outside investors, no existing SAFEs, and no notes outstanding. Funding to date comes from approximately $47,055 of founder personal capital invested directly in R&D, product, and early infrastructure (2023–2024).
This structure matches Capital Plan guidance: founder ≈80–90%, service providers 5–10%, with unallocated pool created at priced round.
Seed SAFE Terms
Binding Structure
Core Terms
- Instrument: YC post-money SAFE
- Valuation Cap: $15,000,000 post-money
- Discount: 20% (relevant in priced round where discount < cap price)
- MFN: Included for investor protection
- Pro-rata rights: For checks ≥$100,000
Raise Band
- Minimum: $1.0M
- Target: $1.4M
- Hard Cap: $1.6M
SAFE Ownership Rule: SAFE % = Investment ÷ $15,000,000 (post-money cap)
This rule comes directly from the YC post-money SAFE framework and is explicitly required in Seed Capital Plan v1.1.
SAFE Ownership by Raise Size
6.67%
$1.0M Raise
Minimum acceptable close scenario
8.00%
$1.2M Raise
Within stated band
9.33%
$1.4M Target
Base plan scenario
10.67%
$1.6M Hard Cap
Maximum dilution allowed
All percentages exactly match Capital Plan and Appendix A requirements. Pre-money holders retain 89.33% to 93.33% depending on raise size.
Pro-Forma Cap Table at Target Raise
$1.4M Scenario
Pre-money holders collectively retain approximately 89.7% ownership, with SAFE investors receiving 9.33% at the $15M post-money cap. This maintains founder majority control while providing meaningful equity incentives to key contributors.
All Raise Scenarios Comparison
SAFE Conversion Mechanics
How the SAFE Converts at Series A
Under a priced Series A, SAFE holders convert at the better of two prices: the Valuation Cap Price or the Discount Price. Because the SAFE is post-money, the investor's percentage ownership relative to the company is already fixed at the time of the SAFE financing.
01
Valuation Cap Price
$15,000,000 post-money cap determines implied share/unit price based on total capitalization
02
Discount Price
20% discount to Series A price (discount factor = 1 ÷ 0.8 = 1.25x)
03
Conversion Rule
SAFE investors receive the lower of these two prices, maximizing their ownership percentage
04
Ownership Fixed
Post-money SAFE means ownership percentage is determined at SAFE signing, not at conversion
Series A Conversion Example
Required Scenario Analysis
Scenario Parameters
- Seed investor: $250,000 in SAFE
- Total Seed raise: $1.4M (target)
- Series A: $40M pre-money
- Series A raise: $10M
Step 1: SAFE % at Signing
SAFE % = $250,000 ÷ $15,000,000 = 1.67%
Step 2: Post-Series A Ownership
Post-money holders include pre-money shareholders, SAFE holders, and Series A investors. SAFE percentage remains 1.67% post-conversion.
Step 3: Pro-Rata Rights
A $250k investor is eligible for pro-rata rights in Series A. They may purchase additional shares to maintain their 1.67% ownership post-Series A.
Key Insight: Pro-rata rights allow investors ≥$100k to maintain or increase their ownership percentage through participation in future rounds.
Mathematical Conversion Formula
Variables
- I = Investor's SAFE amount
- CapPM = $15,000,000 post-money cap
- SeriesA_Pre = Series A pre-money valuation
- A_Discount = Series A price × (1 − 20%)
Formulas
- SAFE Ownership % = I / CapPM
- Conversion Price = min(CapPrice, DiscountPrice)
- SAFE Units = I ÷ Conversion Price
Investment Amount Reference Table
This table provides quick reference for investors to understand their ownership percentage at the $15M post-money cap. Pro-rata rights apply to all investments ≥$100,000.
Cap Table Red Flags
Critical Items for Investor Review
No Formal ESOP Pre-Seed
Intentional design—ESOP to be created at priced round. This will create additional dilution for all stakeholders including SAFE holders.
Service Provider Warrant Consistency
Final FD% depends on unit count. Ensure consistency with prior agreements (FSMAD, DS/MLE documentation). Review signature-ready versions.
MFN Scope Clarification
MFN must not unintentionally imply governance rights or ratchet-like economics. Scope limited to economic terms only.
Cross-Document Consistency
All decks, memos, and public-facing numbers must match: $15M post cap, 1.0–1.6M raise band, SAFE % bands (6.7%–10.7%).
Internal Reconciliation Items
Pre-Investor Review Checklist
- Unit Count Verification: Ensure unit count assigned to service providers supports percentage ranges shown in cap table
- Operating Agreement Alignment: Ensure Operating Agreement references match SAFE language exactly
- Financial Statement Reconciliation: Ensure prior financial statements reconcile to ledger (already consistent within workbook)
- Warrant Agreement Execution: Confirm all warrant agreements are fully executed with proper IP assignment clauses
- 409A Valuation: Obtain or update 409A valuation to support warrant exercise prices
Service Provider Equity Agreements
Summary of All Equity-Based Compensation
This document summarizes all service-based equity, warrants, and contractor incentive structures for PropChain LLC as of the Seed SAFE round. It includes role definitions, warrant/equity unit counts and vesting, milestone and delivery conditions, IP assignments and confidentiality obligations, and alignment with the Seed Capital Plan's equity-first labor model.
Equity-First Model
DS/MLE and FSMAD primarily warrant-based with optional partial cash post-close
Warrant-Only Roles
Digital Marketing Lead and ETL Data Engineer start warrant-only (up to 2,000 Common NV units each)
IP Protection
All IP assigned to PropChain with no carveouts; founder remains majority equity holder
Service Provider Summary Table
Investor View
FD% estimates use pre-money fully diluted baseline from Appendix A. All agreements include comprehensive IP assignment and confidentiality provisions.
Employee Option Pool Plan
Framework for First Priced Round
This Employee Option Pool Plan describes how PropChain intends to structure, size, and administer an employee equity pool at the time of the first priced equity round, not as part of the current Seed SAFE raise. The plan aligns long-term incentives with company growth while staying consistent with our equity-first operating model.
1
Pool Creation Timing
Created at first priced equity round (Series Seed Equity / Seed Prime / Series A) when PropChain converts from LLC to C-Corporation.
2
Target Pool Size
Approximately 10–15% of fully-diluted capitalization (FD), post-conversion and immediately after Plan adoption, before new priced round shares.
3
Market Alignment
Working midpoint of ~12% FD, designed to fit within 0–10% "unallocated pool" placeholder while preserving founder majority ownership.
Option Pool Allocation Guidelines
Ranges are illustrative and assume a 10–15% pool with founder majority preserved. Will be refined in Compensation & Equity Philosophy doc and reviewed against market data at priced round.
Option Pool Red Flags
Critical Items for Future Review
Pool Size Not Fixed
Plan specifies 10–15% target band, but actual pool percentage set in priced round term sheet. Pool significantly above 15% would create additional dilution vs current assumptions.
Universal Dilution
Under YC post-money SAFE mechanics, employee pool at priced round will dilute everyone on cap table including SAFE holders on pro-rata basis.
Contractor vs Employee
Heavy reliance on equity-first contractor models (warrants) for DS/MLE, FSMAD, DML, and ETL. If roles convert to FT employees with additional options, total service-based equity may approach top end of 5–10% band.
Implied Promises
Any informal promises of fixed percentage grants must be interpreted in context of fully-diluted, post-SAFE, post-pool ownership. Plan intentionally uses bands and FD language.
LLC to C-Corp Conversion
Warrant agreements, Common NV Units, and LLC equity semantics must be cleanly mapped into C-Corp equity plan. Ambiguity could create disputes over vested vs unvested amounts.
Future Pool Refresh
Even with 10–15% pool at first priced round, PropChain may need to top up pool in future rounds as team scales. Future top-ups create additional dilution.
Provided these red flags are understood and mitigated through clear term sheet language and board governance, the option pool plan supports PropChain's growth trajectory while maintaining disciplined equity management aligned with the 24-month Seed runway model.