Carta Diligence Research Report
Underwrite Carta only if data-room materials substantiate durable ARR growth, improving gross margins in fund administration/legal services, low churn after the 2024 trust incident, strong security/data governance, clean regulatory/legal exposure and a current capitalization that supports attractive risk-adjusted ownership despite valuation compression from prior peaks.
Carta Diligence Research Report
Carta passed the public-source eligibility screen for this report: public sources show active operations, large private-market scale and valuation references above $1B, while no verified IPO, acquisition or shutdown was found in reviewed sources. The diligence profile is high-potential but high-trust-sensitivity: Carta appears to have scaled revenue/ARR and a broad private-capital platform, yet financial statements, current cap table, retention, product margins, legal exposure and data-governance evidence remain private.
Public sources disclose scale signals and estimates, but audited financials, margins, burn, cash runway, revenue mix, taxes and ARR methodology are not public.
Diligence request: Obtain audited statements, management accounts, KPI dashboard, revenue waterfall, gross margin by product and cash/debt schedule.
Public valuation references range from $7.4B/$8.5B highs to a reported possible $2B 2024 secondary, with preferences and current ownership private.
Diligence request: Request current cap table, financing docs, secondary documents, 409A, preference stack and waterfall under downside exits.
Press reported 2023 loss and fund-admin gross-margin issues while Carta expands into ERP/legal/professional services.
Diligence request: Review product-level P&L, services utilization, gross margins, implementation costs and fund-customer retention.
Carta reports large company/security-holder scale and named logos, but public materials do not disclose active definitions, revenue concentration, retention or complaints.
Diligence request: Request top-customer schedule, active definitions, NRR/churn cohorts, CSAT/NPS, support metrics and permissioned references.
Carta’s proprietary cap-table/investor data is core to the business and to customer trust; prior secondary-market allegations show the sensitivity of perceived data misuse.
Diligence request: Review data-use policies, access controls, product separation, customer consents, audit logs and remediation from the Linear/CartaX incident.
Carta publicly describes encryption, logging, DR and audits, but actual SOC/ISO reports, test findings, vulnerabilities and incident history require restricted access.
Diligence request: Obtain SOC 1/2, ISO certificate/scope, pen-test summaries, incident register, cyber insurance and vendor-risk reports.
Carta publicly claims SEC transfer-agent status and Carta Law UK SRA-regulated ABS status, increasing regulatory, supervision and claims-risk diligence.
Diligence request: Have securities/regulatory counsel review registrations, exams, complaints, correspondence, legal-services scope and jurisdictional permissions.
Carta uses AI/data workflows in Fund ERP and Carta Law while processing financial, transactional and AML/KYC identifiers.
Diligence request: Request AI model inventory, vendor contracts, data-flow maps, DPAs, privacy impact assessments, model evaluations and client-data isolation evidence.
Public sources support Carta as an active private unicorn with meaningful revenue/ARR scale, but audited financial statements, capitalization, projections, margin, cash runway and valuation support are not public.
not publicly verifiable confidence: medium
Carta discloses company-controlled ARR and press/analyst estimates exist, but no audited statements or management accounts were public.
| Metric or document | Public signal | Verification status | Missing for underwriting |
|---|---|---|---|
| ARR / revenue scale | Carta About: $500M ARR crossed in 2025; Sacra: $442M ARR in 2024; TechCrunch: $380M revenue and $65M loss in 2023. | Partially verified | ARR definition, audited revenue, product mix and revenue recognition. |
| Gross margin | TechCrunch reported fund-admin gross-margin challenges. | Partially verified | Product-level COGS, services utilization and margin bridge. |
| Cash runway and burn | No public cash, debt, burn or runway schedule found. | Not publicly verifiable | Cash/debt schedule, budget-vs-actuals and board plan. |
| Backlog / deferred revenue / AR | No public operational finance package found. | Not publicly verifiable | Backlog, deferred revenue, billing, collections and AR aging. |
Company ARR and third-party revenue estimates should not be treated as audited financial statements.
Revenue/ARR and valuation are plotted on same USD-million scale for context only.
not publicly verifiable confidence: medium
No board-approved forecast, pipeline-backed model or downside case was publicly available.
partially verified confidence: medium
Historical financing and valuation references are public, but current cap table, preference stack and current common value are private.
| Eligibility test | Public evidence | Status | Diligence implication |
|---|---|---|---|
| Active operations | Carta About page reports current products, 50,000+ companies, $500M ARR crossed in 2025 and 1,900+ employees. | Passed public-source screen | Active-company evidence; verify with corporate records. |
| Unicorn valuation | 2021 Series G at $7.4B; 2024 reported secondary at possible $2B. | Passed public-source screen | Still above $1B in reviewed public sources, but valuation compressed. |
| No IPO/acquisition/shutdown | Reviewed active company pages and independent press references; no verified disqualifying event found in those sources. | Partially verified | Reconfirm immediately before investment committee. |
Eligibility conclusion is based on public evidence available as of the accessed date, not legal confirmation.
| Topic | Public anchor | Risk | Follow-up request |
|---|---|---|---|
| Series G | $500M Series G at $7.4B valuation led by Silver Lake per TechCrunch/Sacra. | Preference stack and investor rights unknown. | Full financing docs, investor rights, side letters and waterfall. |
| Secondary valuation | TechCrunch reported contemplated $2B 2024 secondary after $8.5B late-2022 claim. | Mark-to-market compression and employee/investor liquidity pressure. | Secondary documents, participant list, clearing price and board approvals. |
| Total funding | TechCrunch 2021 says $1.29B; Carta About says $1.2B+ raised by Carta. | Round count/terms and dilution unknown. | Cap table, option pool, convertible notes/warrants and debt. |
| 409A and common value | Carta sells 409A products but its own 409A not public. | Common value may differ materially from preferred/secondary marks. | Latest 409A, common FMV history and valuation memo. |
Carta’s own market position in valuation products heightens conflict and methodology diligence.
Dates without day precision are represented as month-level public milestones.
partially verified confidence: medium
Public reporting highlights valuation pressure, 2023 loss estimate and secondary-business exit; accounting/tax policies and product economics remain private.
Carta publicly offers a broad private-capital platform spanning issuer equity management, fund operations, transfer-agent workflows and Carta Law; product economics, adoption and delivery quality remain private.
verified confidence: high
Public pages substantiate Equity Suite, Fund ERP and Carta Law product lines.
| Module | Public description | Potential moat | Required diligence |
|---|---|---|---|
| Cap Table Management | View, track and issue equity on a secure platform. | System of record and transfer-agent workflows create switching costs. | Active issuers, uptime, accuracy, migration churn and support tickets. |
| Total Compensation | Startup-specific benchmarks to forecast, hire and retain talent. | Dataset scale may improve benchmarks. | Data rights, benchmark methodology, customer adoption and accuracy. |
| Equity Advisory | Tax strategies from experts to help employees understand equity. | Services attachment to software. | Margins, compliance, liability and staffing utilization. |
| Liquidity / tender offers | Run tender offers while maintaining full control of cap table. | Cap-table integration. | Scope after secondary-trading exit, conflict controls and broker/dealer dependencies. |
| QSBS / 409A | QSBS attestation and audit-ready 409A valuations. | Compliance workflow with cap-table data. | Accuracy, audit challenges and customer claims. |
Product claims are company-controlled; revenue/adoption by module remains private.
| Offering | Public components | Strategic rationale | Diligence flags |
|---|---|---|---|
| Fund ERP front office | Deal CRM and LP CRM. | Acquire fund customers earlier in workflow. | CRM adoption, data quality and competition with fund CRMs. |
| Fund ERP middle office | Portfolio analytics, valuations and fund reporting. | Increase data connectivity and reporting value. | Accuracy, auditability, integrations and methodology. |
| Fund ERP back office | Equity management, fund administration/financials, tax/compliance and LP portfolio management. | Broader share of private-capital operations. | Service margins, staff leverage and tax/compliance liability. |
| Carta Law | Compliance, contracts and fund services, attorney-verified AI workflows. | Outcome-based legal/compliance revenue and tighter workflow lock-in. | Regulatory scope, professional liability and AI governance. |
Fund ERP and Carta Law may improve customer value but add operational and regulatory complexity.
Architecture is inferred from public pages, not internal system architecture.
verified confidence: high
Public pricing shows tiers from free Launch to Scale with advanced compliance features.
| Plan | Public eligibility/features | Commercial implication | Diligence question |
|---|---|---|---|
| Launch | Free first cap table; up to 25 stakeholders and $1M raised. | Top-of-funnel acquisition and early standardization. | Free-to-paid conversion and support cost. |
| Build | Up to 50 stakeholders plus onboarding, priced-round modeling and deal closings. | Monetizes fundraising/complexity. | Attach rate to round support and price realization. |
| Grow | Flexible stakeholder limit, board meetings, Form 3921 and 409A valuations. | Compliance upsell as companies mature. | 409A margin, audit outcomes and renewal lift. |
| Scale | ASC 718/US GAAP, Rule 701, IFRS, exit modeling, IPO Advisory and SSO. | Enterprise compliance tier. | Enterprise discounting, win/loss and implementation burden. |
Public tiers do not reveal contracted prices, discounting or renewal mechanics.
Counts are analyst-normalized from public feature lists and should not be used as exact SKU economics.
partially verified confidence: medium
Carta’s product evolution suggests network/data integration ambitions but also conflict and trust constraints.
Carta publicly claims substantial customer/data scale and displays notable logos, but top-customer schedules, concentration, retention, churn, product adoption and customer satisfaction are private.
partially verified confidence: medium
No top-customer schedule is public; only scale metrics and curated logos/testimonials are visible.
| Claim | Source | What it supports | What remains unknown |
|---|---|---|---|
| 50,000+ companies in 160+ countries | Carta About | Broad issuer/company footprint. | Active definition, paying status, segment mix and churn. |
| 85% of US unicorns using Carta cap table | Carta About | Penetration among high-value venture-backed companies. | Currentness, definition and revenue concentration. |
| Over 50,000 private companies and 2.5M security holders use Carta | Data methodology | Dataset scale for Data Desk/benchmarks. | Opt-outs, duplicate users, dormant accounts and data quality. |
| Trusted by over 1.7M equity holders | Equity page | Equity-holder footprint. | Active users, satisfaction and incident history. |
Company-controlled scale metrics should be reconciled to billing and product telemetry.
| Gap | Why it matters | Risk if adverse | Request |
|---|---|---|---|
| Top customers by revenue and product | Identifies concentration and cross-sell. | A few fund-admin/late-stage accounts may drive outsized ARR. | Top 25 customer schedule with ARR, products, tenure and renewal dates. |
| Retention cohorts and churn reasons | Tests switching costs and satisfaction after trust incidents. | Logo count may hide high SMB churn or enterprise migrations. | GRR/NRR cohorts by segment and churn interviews. |
| Customer data-use consent and opt-outs | Data Desk and AI features depend on customer trust and rights. | Privacy/contract limitations may constrain data monetization. | DPA, opt-out logs, data-use policy and consent audit. |
| Support and implementation metrics | Professional-services-heavy products can create margin and satisfaction risk. | Fund-admin quality issues can cause churn and reputational harm. | SLA performance, ticket aging, implementation backlog and CSAT/NPS. |
Customer diligence is the highest-priority non-financial workstream.
Mixed units are plotted for dashboard-style illustration; use table detail for interpretation.
verified confidence: medium
Equity Suite and Fund ERP pages show recognizable logos and testimonials, but curated references are not independent satisfaction evidence.
| Segment | Public names/examples | Evidence type | Diligence use |
|---|---|---|---|
| Equity Suite companies | Betterment, Brex, Demostack, iSpot, Perkville, Radar, Double A Labs, Guide. | Company page logos/testimonials. | Reference targets; verify active/current status and ARR contribution. |
| Fund ERP / funds | Base10, Delta-v, Kayne Anderson, QED, Sagewind, Shore, DataTribe, Emergent, Pelion. | Company page logos/testimonials. | Segment reference targets; test fund-admin satisfaction and switching risk. |
| Security/trust center logos | Calendly, Puppet, Samsara, Brex, Menlo Ventures, Base10, Tribe Capital. | Trust center trusted-by logos. | Confirm logo permissions and role as security-review users/customers. |
| Carta Law clients | 200+ clients, no named list on reviewed page. | Company scale metric. | Request customer list, retention and claims/complaint history. |
Logo evidence is useful for sampling, not concentration analysis.
not publicly verifiable confidence: medium
Revenue concentration, retention, churn reasons and support quality were not publicly verifiable.
Risk placement is not a legal conclusion.
Carta competes across several markets rather than a single category: cap tables/409A, fund administration/SPVs, late-stage equity/liquidity and global compensation.
verified confidence: high
Public competitor pages identify Pulley, AngelList, Morgan Stanley at Work/Shareworks and Ledgy as relevant alternatives.
| Competitor | Public positioning | Overlap with Carta | Carta diligence angle |
|---|---|---|---|
| Pulley | Cap table management for founders/finance leaders; explicitly targets Carta switchers. | Cap tables, 409A, compliance/SBC, fundraising, SAFEs, liquidity and employee experience. | Migration friction, pricing and trust after Linear/CartaX incident. |
| AngelList | Tools for private funds, venture funds, SPVs and digital subscriptions. | Fund administration, investor management and private-fund workflows. | Fund ERP differentiation and fund-manager retention. |
| Morgan Stanley at Work / Shareworks | Private-company equity administration, liquidity and 409A, with enterprise financial-services breadth. | Late-stage/private-company equity plans and liquidity. | Enterprise migrations and partnership economics. |
| Ledgy | Global equity and executive compensation from incorporation to post-IPO. | Equity administration and global compensation. | International/localization pressure in Europe and post-IPO workflows. |
Competitor pages are self-promotional; independent win/loss needed.
Coordinates are analyst qualitative estimates from public positioning.
partially verified confidence: medium
Carta’s public scale suggests leadership, but market share, retention and defensibility are not independently verifiable.
| Moat vector | Evidence | Diligence strength | Failure mode |
|---|---|---|---|
| System of record / transfer agent | Carta says it is SEC-registered transfer agent and manages electronic securities. | Potentially high switching cost. | Trust incident or poor support can motivate painful migration. |
| Network data and benchmarks | 50,000+ companies, 2.5M security holders and Data Desk methodology. | Differentiated dataset. | Privacy/contract limits and customer opt-outs constrain use. |
| Product breadth | Equity Suite, Fund ERP and Carta Law. | Cross-sell and integrated workflows. | Breadth creates operational complexity and margin drag. |
| Brand/category leadership | 85% of US unicorns using Carta cap table; recognizable logos. | High awareness in VC ecosystem. | Reputation damage and competitor founder-friendly positioning. |
Moat must be tested with customer references and churn/migration data.
Risk placement is analyst judgment based on public evidence.
partially verified confidence: medium
Substitution risk is highest where competitors exploit trust, price, localization, or professional-services quality.
| Use case | Likely alternatives | Substitution risk | Evidence needed |
|---|---|---|---|
| Early-stage cap table and 409A | Pulley, law-firm/admin spreadsheets, regional providers. | Medium-high if price/support/trust weakens. | Early-stage win rates, free-to-paid conversion and migrations. |
| Fund admin / SPVs | AngelList, fund administrators, banks, accounting firms. | High because workflows include services and compliance. | Fund cohort retention, gross margin and customer references. |
| Late-stage equity and liquidity | Morgan Stanley Shareworks, banks and broker-led tenders. | Medium-high at enterprise/post-IPO inflection. | Late-stage churn, partnership economics and IPO handoff process. |
| Global equity/executive comp | Ledgy and local/regional providers. | Medium in Europe/global compensation. | Localization roadmap, compliance coverage and international ARR. |
Competitive risk is concentrated where trust, localization and services quality matter most.
Carta’s public GTM combines self-serve/free entry, sales-led paid tiers, fund/enterprise demos, data-content authority, customer references and strategic partnerships, but CAC/payback and channel economics are private.
partially verified confidence: medium
Public evidence shows free Launch/self-serve, paid pricing tiers, request-demo motions, Data Desk content and customer stories.
| Motion | Public evidence | Likely funnel role | Private diligence need |
|---|---|---|---|
| Free/self-serve Launch | Launch first cap table for free; sign-up CTA. | Early-stage acquisition and standardization. | Activation, conversion, support cost and cohort LTV. |
| Sales-led Build/Grow/Scale | Get started / request-demo CTAs for paid tiers and Fund ERP. | Monetize complexity, compliance and funds. | Pipeline, quota capacity, discounting and payback. |
| Customer stories / logos | Equity and ERP pages show logos/testimonials. | Social proof and reference selling. | Reference permissions, churn and revenue by logo. |
| Data Desk thought leadership | Newsletter/reports across Carta dataset. | Inbound demand and ecosystem authority. | Attribution, subscriber conversion and data-rights governance. |
GTM appears multi-motion; efficiency remains unverified.
Counts are intentionally null because funnel metrics are not public.
verified confidence: medium
Morgan Stanley/NYSE partnerships and acquisitions support exit-readiness, credibility and product expansion narratives.
| Channel / partner | Public evidence | Potential impact | Diligence question |
|---|---|---|---|
| Morgan Stanley at Work | About page says exclusive partnership and preferred public equity management platform for IPO-planning companies. | Late-stage/IPO handoff and enterprise credibility. | Revenue share, referral economics, exclusivity and customer ownership. |
| NYSE | About page says NYSE preferred listing venue and Morgan Stanley Wealth Management services integrated. | IPO-readiness positioning and exchange channel. | Commercial terms and customer conversion. |
| Data ecosystem | Data Desk reports and featured media logos. | Brand authority in private-market benchmarks. | Data-use rights and conversion from content. |
| Acquired platforms | Vauban, Capdesk and Tactyc acquisitions. | Geographic/product expansion. | Integration, retention and revenue synergies. |
Public partnerships may be marketing-oriented; contracts are needed.
Partnership economics are not public.
not publicly verifiable confidence: medium
Public pages do not disclose quota capacity, discounting, sales productivity, expansion or renewal economics.
| Commercial topic | Public evidence | Gap | Request |
|---|---|---|---|
| CAC/payback | None public. | No sales efficiency data. | CAC, payback, S&M expense by segment and cohort LTV. |
| Pricing realization | Public tiers, free Launch and requested-demo CTAs. | No discounting, ACV or net price. | Bookings waterfall, average ACV, discounting and renewal uplift. |
| Salesforce productivity | Executive CRO listed, but no rep counts/quotas. | Quota capacity and attainment unknown. | Rep roster, quota attainment, ramp, pipeline coverage and churned ARR. |
| Partner economics | Morgan Stanley/NYSE partnership announcements on About page. | No contracts/economics. | Partner contracts, referral volumes and revenue share. |
Commercial data must come from Carta’s CRM/finance systems.
Carta’s public R&D story emphasizes integrated data connectivity, context-aware AI, human review, security and acquisitions; internal architecture, roadmap, model governance and engineering metrics are private.
partially verified confidence: medium
Carta publicly describes encryption, access control, logging, backup/restore, HA architecture, BCP and third-party audits.
| Control area | Public control | Diligence relevance | Evidence to request |
|---|---|---|---|
| Encryption | AES256 at rest, TLS 1.2+ in transit. | Baseline protection for sensitive cap-table/financial data. | Architecture diagrams, key management and encryption scope. |
| Access control | Least privilege and every internal action/click logged. | Critical after data-use allegations. | Access review logs, SoD, privileged access and audit trails. |
| Resilience | Daily backups/restores, AWS HA/redundant architecture and annual BCP testing. | Operational continuity for legal system of record. | DR tests, RTO/RPO, incident history and tabletop results. |
| Assurance | SOC1, SOC2, ISO27001 audits and trust-center quick summary. | Enterprise sales requirement. | Reports, scopes, exceptions and remediation evidence. |
Full security review requires protected reports and technical interviews.
Inferred from public controls; not internal architecture.
partially verified confidence: medium
Carta publicly describes context-aware AI in Fund ERP and static in-house LLMs for Carta Law, while Data Desk uses aggregated/anonymized customer data.
| Area | Public statement | Risk | Request |
|---|---|---|---|
| Fund ERP AI | Context-aware AI and agent-led workflows with human expertise/monitoring. | Incorrect financial/fund outputs or opaque automation. | Model inventory, evals, monitoring, error budgets and escalation process. |
| Carta Law AI | Static in-house LLMs; no client data used outside environment or for training. | Confidentiality, privilege, unauthorized model training, attorney oversight. | Architecture, vendor contracts, logs, privilege workflow and model access controls. |
| Data Desk | Aggregated/anonymized data; opt-out companies excluded. | Reidentification, contractual restrictions and customer trust. | Aggregation thresholds, privacy reviews, opt-out audit and data lineage. |
| Sensitive KYC/financial data | Collects bank, brokerage/custodial, tax IDs, equity holdings and government IDs when needed. | Privacy, GLBA, AML/KYC and breach exposure. | Data map, retention, DPA/subprocessors, PIAs and incident response. |
AI/data governance is a cross-cutting technical and legal workstream.
partially verified confidence: medium
Public milestones show acquisitions and AI/product roadmap themes, but R&D staffing, roadmap delivery and integration status are private.
| Signal | Public evidence | R&D implication | Validation needed |
|---|---|---|---|
| Vauban/Capdesk acquisitions | European/UK equity-management expansion in 2022. | Localization and international platform integration. | Integration architecture, churn and roadmap completion. |
| Tactyc acquisition | Forecasting/planning solution for venture funds acquired in 2024. | Fund forecasting and analytics expansion. | Product adoption, data integration and revenue contribution. |
| Fund ERP AI | Context-aware AI, agent-led workflows and human review. | AI-assisted private-capital operations. | Model evals, human-in-loop SLAs and error rates. |
| Carta Law AI | Attorney-verified AI workflows and static in-house models. | AI-native legal/compliance services. | Model inventory, data isolation and professional-liability controls. |
Public roadmap references require engineering/product KPI validation.
Carta has a visible executive team and large public workforce footprint, but board composition, org chart, compensation, turnover, HR matters and litigation exposure require private diligence.
verified confidence: high
Carta’s executive roster is public and includes CEO, CFO, CRO, CPO, CMO and Chief Product Officer roles.
| Executive | Public role | Diligence focus | Publicly verified source |
|---|---|---|---|
| Henry Ward | Chief Executive Officer | Founder/CEO key-person risk, governance, incident response. | Carta Executive Team |
| Charly Kevers | Chief Financial Officer | Financial reporting, forecast, controls, fundraising. | Carta Executive Team |
| Jeff Perry | Chief Revenue Officer | Sales execution, GTM, press-reported allegations requiring counsel review. | Carta Executive Team |
| Nick Avery | Chief People Officer | Culture, retention, HR litigation/remediation. | Carta Executive Team |
| Nicole Baer | Chief Marketing Officer | Brand recovery, demand generation and Data Desk positioning. | Carta Executive Team |
| Vrushali Paunikar | Chief Product Officer | Product roadmap, AI/data governance and platform quality. | Carta Executive Team |
Board roster, reporting lines and compensation were not public.
Reporting lines are analyst assumptions for visualization; actual org chart was not public.
partially verified confidence: medium
Carta claims 1,900+ employees in 16 locations and 400+ finance experts, but payroll/HR data is not public.
| Dimension | Public evidence | Diligence implication | Follow-up |
|---|---|---|---|
| Employee count | 1,900+ employees in 16 locations. | Scaled organization with material fixed costs. | Headcount by function/geography, contractor count and productivity. |
| Locations | San Francisco, New York, Seattle, Utah, Santa Clara, New Jersey, Washington DC, Canada, Brazil, UK, Denmark and others listed. | Multi-jurisdiction HR, tax and regulatory complexity. | Entity map, local compliance and office lease obligations. |
| Careers messaging | Active careers page and operating principles. | Employer brand remains active. | Open roles, attrition, hiring plan and engagement scores. |
| Operating model | Fund ERP page cites 400+ finance experts. | Services capacity is a key cost and quality driver. | Utilization, cost structure, turnover and QA. |
Workforce public claims require HRIS/payroll validation.
partially verified confidence: medium
Press-reported lawsuits and culture allegations create a material HR/reputation diligence workstream.
| Signal | Public evidence | Potential impact | Required review |
|---|---|---|---|
| Press-reported lawsuits/exposés | SF Standard article summarizes multiple lawsuits and culture allegations. | Reputation, retention, damages, sales friction. | Dockets, settlements, reserves, insurance and remediation. |
| CRO named in lawsuit allegations | SF Standard reported allegations involving Jeff Perry; Carta/individual defenses not fully evaluated here. | Leadership distraction and HR risk. | Counsel memo, HR investigation and current status. |
| CEO communications on negative press | TechCrunch referenced customer communications around negative press. | Customer trust and governance scrutiny. | Board oversight and customer churn/renewal impact. |
| Operating principles emphasize transparency/owners | Careers page states “We play in the open” and “We act as owners.” | Culture aspirations may not align with allegations. | Employee survey, complaint log and attrition by cohort. |
Allegations are not adjudicated here; counsel should evaluate status and exposure.
Carta’s public legal surface includes SEC transfer-agent positioning, Carta Law UK regulation, sensitive privacy/data processing, trademarks and significant reputational/legal incidents; legal conclusions require counsel review.
partially verified confidence: medium
Public sources identify eShares, Inc. dba Carta, Inc., transfer-agent status for U.S. companies and Carta Law UK SRA-regulated ABS status.
| Area | Public evidence | Diligence concern | Request |
|---|---|---|---|
| Corporate identity | Privacy policy identifies eShares, Inc. dba Carta, Inc. and affiliates/subsidiaries including Avantia Law Limited t/a Carta Law. | Entity map and cross-border processing. | Org chart, subsidiaries, good standing and intercompany agreements. |
| Transfer agent | Pricing page states Carta is an SEC-registered transfer agent for U.S. companies. | SEC registration, exams, recordkeeping and complaints. | Registration, exams, correspondence, policies and incident logs. |
| Carta Law | UK SRA-regulated Alternative Business Structure. | Professional regulation, insurance and jurisdictional scope. | SRA records, insurance, engagement terms and complaints. |
| Financial/product transactions | Pricing page references stock exercises, repurchases and online transactions. | Funds flow, ACH/wires, brokerage/custody dependencies. | Bank/payment/vendor contracts and regulatory analysis. |
Regulatory counsel review is required before relying on public claims.
partially verified confidence: medium
CARTA trademark registrations appear live and relevant; CARTAX was abandoned. Privacy policy confirms sensitive data processing categories.
| Topic | Public evidence | Status | Diligence request |
|---|---|---|---|
| CARTA mark software | USPTO CARTA serial 87124762, registration 5503746, live/continued use accepted. | Partially verified during research; refresh required. | Counsel refresh TSDR, assignments and oppositions. |
| CARTA mark financial services | USPTO CARTA serial 87124770, registration 5503747, live/continued use accepted. | Partially verified during research; refresh required. | Counsel refresh TSDR, licensing and use. |
| CARTAX | USPTO CARTAX serial 90201117 dead/abandoned June 17 2024. | Partially verified during research; refresh required. | Review abandonment in light of CartaX/secondary-business shutdown. |
| Privacy policy | Financial, transactional and AML/KYC personal information categories disclosed. | Verified company policy. | DPA, subprocessors, retention, GLBA/privacy compliance and PIAs. |
USPTO API access required key in final session, so counsel refresh is important.
partially verified confidence: medium
Public reporting surfaces the Linear/CartaX data-use controversy, secondary-trading exit and employment/culture lawsuits.
| Event | Public evidence | Risk category | Required diligence |
|---|---|---|---|
| Linear/CartaX data-use allegation | TechCrunch reported customer accusations and Ward apology/employee-procedure breach statement. | Trust, privacy, contracts, reputation. | Incident investigation, customer notices, contracts, remediation and churn impact. |
| Exit from secondary trading | TechCrunch quoted Ward: prioritize trust and exit secondary trading. | Strategic, revenue, regulatory. | Shutdown scope, residual obligations, broker/dealer/account transfers and product roadmap. |
| Valuation/revenue/loss report | TechCrunch reported $2B secondary attempt, $380M revenue and $65M 2023 loss. | Financial, financing, reputation. | Financial package and valuation support. |
| Employment/culture lawsuits | SF Standard summarized lawsuits and culture allegations. | Employment, governance, reputation. | Docket review, settlements/reserves, insurance and HR remediation. |
Public reporting is sufficient to flag diligence; it is not a legal conclusion.
| ID | Claim | Status | Sources |
|---|---|---|---|
| EC-001 | Carta presents itself as an active private-capital software and services company with large public scale metrics. | verified high | SRC-001 |
| EC-002 | Carta raised a $500M Series G at a $7.4B valuation in 2021 and told TechCrunch it had raised $1.29B altogether. | verified high | SRC-013 |
| EC-003 | Public reporting in June 2024 indicated Carta was pursuing a secondary sale at a possible $2B valuation, materially below 2021/2022 marks but still above the unicorn threshold. | partially verified medium | SRC-014 |
| EC-004 | Sacra estimated Carta reached $442M ARR in 2024 and was last valued at $7.4B in the 2021 Series G. | partially verified medium | SRC-018 |
| EC-005 | No audited financial statements, management accounts, cash runway, revenue mix, gross margin or cap-table details were found in public sources. | not publicly verifiable medium | SRC-001SRC-014SRC-018 |
| EC-006 | Carta Equity Suite spans cap table, total compensation, equity advisory, liquidity/tender offers, QSBS and 409A products. | verified high | SRC-004 |
| EC-007 | Carta pricing publicly segments corporation plans into Launch, Build, Grow and Scale, with increasingly complex compliance and administration features. | verified high | SRC-005 |
| EC-008 | Carta publicly states it is a registered transfer agent with the SEC for U.S. companies. | verified high | SRC-005 |
| EC-009 | Carta Fund ERP spans front, middle and back-office fund workflows and emphasizes connectivity, context-aware AI and human control. | verified high | SRC-006 |
| EC-010 | Carta Fund ERP claims 400+ finance experts and named fund customers/testimonials. | verified high | SRC-006 |
| EC-011 | Carta Law is positioned as attorney-led, AI-native legal/compliance services for private capital and claims 200+ clients, $14T AUM supported and 40K+ transactions. | verified high | SRC-007 |
| EC-012 | Carta Law says client data is not used to train outside models. | verified high | SRC-007 |
| EC-013 | Carta Data Desk uses a large proprietary dataset and says published customer data is aggregated/anonymized with opt-outs excluded. | verified high | SRC-009 |
| EC-014 | Carta Equity page lists recognizable customer logos/testimonials and claims 1.7M+ equity-holder trust. | verified high | SRC-004 |
| EC-015 | Carta’s security page states AES256-at-rest, TLS 1.2+ in transit, least privilege, full internal action logging, daily backup/restore, AWS HA and annual BCP review/testing. | verified high | SRC-010 |
| EC-016 | Carta Trust Center summarizes annual audits, MDM, penetration testing, disaster recovery, cyber insurance and centralized IAM. | verified medium | SRC-011 |
| EC-017 | Carta Privacy Policy says it collects financial/transactional information and sensitive AML/KYC identifiers where necessary. | verified high | SRC-012 |
| EC-018 | Carta’s January 2024 Linear/CartaX incident generated public accusations that Carta misused cap-table/investor information for secondary-sale outreach. | partially verified medium | SRC-015 |
| EC-019 | Carta exited secondary trading in January 2024 after the credibility hit, with CEO citing trust and data conflicts. | verified high | SRC-016 |
| EC-020 | Independent press reported multiple lawsuits and culture allegations involving Carta. | partially verified medium | SRC-017 |
| EC-021 | Carta executive page lists Henry Ward, Charly Kevers, Jeff Perry, Nick Avery, Nicole Baer and Vrushali Paunikar as executives. | verified high | SRC-003 |
| EC-022 | Carta careers page shows ongoing employer branding and operating principles, but not hiring velocity or turnover. | verified medium | SRC-002 |
| EC-023 | Pulley is a direct cap-table competitor with cap table, 409A, compliance/SBC, fundraising modeling, SAFEs, liquidity, employee experience and crypto products. | verified high | SRC-019 |
| EC-024 | AngelList competes in fund administration, SPVs, digital subscriptions and investor/fund operations. | verified high | SRC-020 |
| EC-025 | Morgan Stanley at Work offers private-company equity administration, liquidity and 409A valuation capabilities. | verified high | SRC-021 |
| EC-026 | Ledgy competes with a global equity/executive-compensation platform from incorporation to post-IPO. | verified high | SRC-022 |
| EC-027 | Carta has live CARTA trademark registrations in software and financial services classes, while CARTAX was abandoned. | partially verified medium | SRC-023SRC-024SRC-025 |
| EC-028 | Public-source screen did not verify an IPO, acquisition or shutdown; active company pages and a 2024 secondary report support private-unicorn eligibility, but absence of disqualifying event cannot be exhaustively proven. | partially verified medium | SRC-001SRC-002SRC-014 |
| EC-029 | Carta uses acquisitions and partnerships to extend geography, product breadth and exit-readiness positioning. | verified high | SRC-001 |
| EC-030 | Carta’s GTM relies on company/fund network effects, public pricing for corporations, sales-led enterprise/fund products, customer stories, Data Desk thought leadership and partner channels. | partially verified medium | SRC-001SRC-004SRC-005SRC-006SRC-008 |
This report is a public-evidence diligence snapshot, not investment advice. Important financial, legal, technical, and contractual facts remain non-public and should be verified directly with management and primary documents before any investment decision.