Portfolio companies can now share financial and cap table information with their Investors when their 409A valuation is complete. If you've been shared this data, you can view and download it directly from your Carta account.
How does it work?
When your portfolio company accepts their Carta 409A valuation, we ask them if they want to share some of the data used in the valuation with their Investors to help their investors stay up to date on the company's financial situation and to help streamline some of the jobs needed to be done on the Investors side, such as the ASC 820 valuation.
The portfolio company will select which Investors to share the data with:
If you were one of those Investors that was shared the 409A data, you will then receive an email notifying you of the new document that has been shared and will be able to see it in your Documents tab under that portfolio company in Carta!
What information will be shared?
Information about the company's last twelve month revenue and EBITDA (earnings before interest, taxes, depreciation, and amortization) as well as the previous twelve months revenue and EBITDA. Since the 409A valuation is a valuation of the company at a point in time, the data used is as of a specific date. For example, Meetly conducted their 409A valuation as of 03/01/2019 (this is their valuation date). For the historical financials, the company provided the last twelve months (03/01/2018-2/28/2019) and the previous last twelve months (03/01/2017-02/28/2018).
Summary financial forecast
In addition to their historical financials, the company will also share the projected next twelve month's revenue and EBITDA. Using the same example above, this would mean Meetly has shared 03/01/2019-02/29/2020 financial projections for revenue and EBITDA.
Cash and Debt
The company will also share the cash and debt balances as of their valuation date. In the example above, this would mean Meetly has shared their cash and debt balances as of 03/01/2019.
Summary level ownership information
Some cap table information will also be made available, which includes access to share class level information but will not contain any information about share holders. Here's what you'll see as an investor:
Information about what industry the company operates in will also be shared. This is the industry information that was used to conduct the 409A valuation and may represent the current industry the company operates in. At Carta, we have preset industry lists that are used the 409A valuation. Should "N/A" appear next to industry sector for your shared data, it means the 409A valuation used a custom industry set and this information will not be made available.
Time to exit
This represents the number of years until the company expects to have an exit event. 409A valuations are capped at 5 years for the time to exit so keep this in mind when reviewing this estimated exit term.
What information will NOT be shared with me?
This document will not contain any information about the concluded FMV, latest preferred price, any rights & preferences the preferred share holders have, strike prices or purchase prices, and any information about a specific shareholder.
Is this available to me?
The feature is available to any investor that has been shared the 409A valuation data. If you aren't seeing a document in your account, it may be that your portfolio companies either have not received a new 409A valuation since the feature has been released or have not shared the data with you yet.