The seed pack that survives a term sheet

What was broken

Black Mass Energies, a seed-stage clean-energy startup, needed a credible valuation and deal structure to raise.

What we did

We built a valuation, an investment memo, and a 5-year financial model. We structured the cap table and ESOP pool, assembling a diligence-ready framework aligned for Series A.

Where it landed

The company came out of the engagement with a Series-A-ready seed round: a valuation, a memo, a model and a cap table that all agreed with each other.

The pack an Australian seed round is actually judged on

A memo, a model and a cap table are not three separate documents — they are one claim checked three ways. The memo asserts a valuation; the model has to produce a number consistent with it; the cap table has to show the pool and the instruments that the model assumes exist. When a lead investor or their advisor sits down with the pack, the first thing they do is check that the three agree. A memo that assumes a 15% option pool the cap table does not show, or a model whose revenue build does not match what the memo describes, reads as a pack that was assembled, not built.

Under the Corporations Act 2001, every Australian company — private, unlisted, seed-stage — must keep a register of members that records each shareholder’s name, address, the date they were entered, the number and class of shares held, and what has been paid on them (s169). ASIC treats this register, not a spreadsheet in a data room, as the legal record of who owns the company. A cap table built for a raise has to reconcile against that register before it goes to an investor — a mismatch between what the register says and what the pack claims is the first thing diligence finds.

ESOP pools sit inside a specific tax concession, not just a spreadsheet column

An Australian option pool is not just a slice of the cap table — it usually sits inside the ATO’s employee share scheme (ESS) start-up concession, which lets an eligible unlisted company grant options or shares to employees without immediate up-front tax, provided the company (with connected entities) has aggregated turnover under $50 million and has been incorporated for less than 10 years. Whether the company still qualifies for that concession is exactly the kind of detail a seed pack has to get right before the round, because it changes how the pool is priced and how it reads to a sophisticated investor who has seen the concession used correctly elsewhere.

CapEasy’s part in the pool is the bookkeeping and the schedule behind it: grants, vesting and forfeitures tracked against the register so the ESOP line in the cap table always ties to what was actually issued. Whether the scheme qualifies for the start-up concession, and any lodgment that follows, is a call for your registered BAS or tax agent — everything on our side is prepared for them to review and lodge.

The model has to survive the R&D Tax Incentive question

Clean-energy and deep-tech seed companies raising in Australia almost always get asked whether R&D Tax Incentive (R&DTI) offsets are built into the financial model, and if so, how. Under current rules, an eligible R&D entity with aggregated turnover under $20 million can access a refundable offset (a base rate plus a premium on top of the company tax rate); at $20 million or more the offset is non-refundable, with a higher rate available above a 2% R&D-intensity threshold. The Australian Government has flagged changes to the R&DTI in the 2026–27 Budget, but has stated the program runs under current rules until those changes start from 1 July 2028 — so a 5-year model built today should treat the offset as a scheduled line, not a permanent constant, and flag the changeover year explicitly rather than silently extrapolating today’s rate to 2029 and beyond.

The discipline that transfers is the same one behind the memo: don’t claim a number the model can’t produce. If R&D offsets are assumed as a source of cash in year two or three, the model needs a line showing the eligible spend, the offset rate applied and the turnover band it assumes — reviewable by whoever ends up claiming it, not buried inside a single blended cash-flow figure.

Building the pack forward, not patching it under time pressure

The method that produced a diligence-ready framework here is the same one an Australian seed round needs: build the valuation and the model together so the number is derived, not asserted; build the cap table against the register so every row has a source; and treat the ESOP pool as a scheduled, tracked item from the day it is created rather than a placeholder percentage added before a raise. A pack assembled in the two weeks before a term sheet is the same pack — done under worse conditions, with less time to reconcile the parts that don’t agree.