Qualified Small Business Stock (QSBS)

What’s new

Companies using Carta for 409A will now be additionally assessed for qualified small business eligibility at no extra cost to the company.

Certificates issued by a qualified small business as determined by Carta will have a "QSBS" tag in the product to indicate that the shares represent Qualified Small Business Stock (QSBS). The goal of these tags is help stakeholders make more informed selling decisions.

The IRC’s definition of a qualified small business is restrictive yet vague and open for interpretation at the edges, so potential holders of QSBS should consult their tax advisor before making decisions to sell and claiming the QSBS tax benefit.

How it works

Based on company-provided information during the valuations process, Carta will assess the following criteria for qualified small business eligibility:

  • Company's gross assets are $50M USD or less
  • Company is an active business
  • Company is a C-corp
  • Company does not operate in excluded industries

If a company is identified as a qualified small business, a new badge will appear in the 409A dashboard:

If a stakeholder receives a certificate from a qualified small business but hasn't yet met the 5 year holding period for QSBS, they'll see a "QSBS eligible" tag in their portfolio:

Drilling into the security, the stakeholder will see some additional information about the QSBS status of the certificate:

Stakeholders who have held shares issued by a qualified small business for 5 years will see a "QSBS" tag in their portfolio instead:

Additional Resources

For detailed information about QSBS in Carta, please refer to our QSBS support article.

Who this affects

Companies using Carta for 409A and their stakeholders.

Timing

  • Available now to 50 randomly selected 409A customers
  • General availability for all 409A customers coming in two weeks

[Early Access] Live Chat Support

Carta now offers Live Chat Support to Early Access Users. 

Who does this affect?

Law firm users and companies in Carta Launch 

What’s new?

Users can now opt to chat live with a Support Agent, in addition to the traditional Phone and Email Support. 

They can simply access the Help Center by clicking on the dialog balloon at the bottom right of the screen, where the Live Agent option will be available. 


After accepting the terms and conditions, the user will be connected to a specialized Support Agent. 

This rollout builds upon Carta's investment in a modernized approach to how our customers receive assistance in-app, enabling easy access to multiple engagement types to fit the context of the question, including: 

  • Chat
  • Voice and video
  • Co-browse
  • Screen-sharing 

All within the Help Center in-app! 

New Carta Launch onboarding for early stage founders


What’s new?

Early stage founders can get self-onboard onto Carta Launch faster than ever before. Founders with up to $1M raised or 25 stakeholders or fewer can now create an account and onboard company data with ease, speed, and confidence for free.  

Carta Launch is live on Product Hunt! We'd so appreciate your upvote!

How it works

Sign up and create your account

  1. On carta.com/launch, click “Get Free Access” 
  2. Fill out a simple form with your company information to create your account.



Guided onboarding

  1. We designed the new onboarding experience to be friendly and guide you through each step



  1. With just Incorporation Documents and Common Stock Purchase Agreements, you can enter information about your Company, Founder Shares, and Users & Roles to complete your onboarding.
  2. Once you’ve reviewed and activated your account, you’re all set to get started on Carta.

  1. Your free Carta Launch plan is suited to fit your immediate fundraising and equity needs and set your company up for success as it scales.


Additional resources 

  • For step by step instructions for how to get started find our video guide here
  • For more information about what is included in Launch, check out this video or check out our most recent blog post. 
  • For any additional questions, please reach out to partners@carta.com or get help through our in-app support. 





Preview and and manage compensation plans

With the new Plans page, you can now craft and manage your compensation plan to meet the needs of a changing workforce. With Plans you can:

  1. Review your active plan or create a new plan.
  2. Edit and preview draft plans.
  3. View your plan history.

Before making modifications to your plan, preview will allow you to see how a change in peer group, band ranges, or location strategy could impact your employees' compensation targets. 


Availability

  • If you are interested in learning more about Carta Total Comp, please reach out to your Carta Customer Success Manager or sign up here.
  • You must be a Carta cap table customer to sign up for Carta Total Comp.

Make better compensation decisions faster

Carta Total Comp 

Carta cap table customers can now access our benchmarking and planning platform to streamline their compensation processes and compensate with confidence.

What’s new?

Workflow tools built on top of the world’s largest equity data set and powerful HR integrations to help you make better compensation decisions faster. Carta Total Comp customers are now able to access the following compensation benchmarking and planning features:

  • Automated Leveling - Map each of your employees into an area, track and level using Carta’s universal leveling framework.
  • Scorecard - Summarizes employee salary and equity information from your HRIS and cap table to give a holistic overview of your organization’s total compensation.
  • Bands - Automatically generate equity and salary bands for any role by filtering for job area, track and location.  
  • HRIS Integration -  Integrate instantly with any of the most common HRIS systems.
  • Coming Soon - Plan -  Easily build, manage and apply your compensation strategy across your employee base.

Get a pulse on your org through your company Scorecard tab



Benchmark any role in the Bands tab

Availability

  • If you are interested in learning more about Carta Total Comp, please reach out to your Carta Customer Success Manager or sign up here.
  • You must be a Carta cap table customer to sign up for Carta Total Comp.

Additional Resources 

  • Carta Total Comp announcement from our Chief Product Officer, Heidi Johnson. Link to Blog Post.

New Equity Reporting Page

Starting 3/22, clicking on the Reporting from the Capitalization dropdown will take you to the new Equity Reporting page. 

The new page contains all the equity reports you're familiar with along with significant improvements to help you access data more quickly and in the manner that you need. You'll notice:

  • Custom reporting - set filter criteria and add, edit, and remove data columns. Save these custom reporting templates for future use.
  • Preview of securities ledger-based reports
  • Search to quickly see standard Carta-provided reports as well as your custom reports


You'll be able to switch back to the classic reporting experience via the blue banner at the top of the new Equity Reporting page until 4/5/21. 


For questions or comments, please email out to reports-feedback@carta.com

New stakeholder address management features for Carta admins

Company administrators can now use the stakeholder address history feature to track multiple, effectively-dated addresses per stakeholder as they move from location to location. Additionally, we've also improved the experience around managing and viewing addresses in Carta for stakeholders based outside of the United States.

Who this affects:

Company administrators responsible for managing stakeholder information in Carta

What’s new:

  • Multiple, effectively-dated addresses per stakeholder. Companies can now reflect a timeline or history of addresses for a stakeholder as they move from location to location
  • Extra structure for non-US addresses. For stakeholders based outside of the US, companies can now track and view stakeholder address information at the country, country region (i.e. state/province/county/etc.), and city level
  • Integration with Carta's tax system. When an option exercise occurs, Carta will estimate tax withholding amounts using multiple tax jurisdictions if the stakeholder lived in more than one location during the vesting period

Track stakeholder address history as they move from location to location:

Old form for adding a non-US stakeholder address:

New form for adding a non-US stakeholder address:


Timing:

All companies will have access to these new features by Wednesday, February 3rd

Resources:

Tax mobility feature available to Carta admins

For company administrators using the new "Tax rules" page in Carta, they can now choose to enable the tax mobility feature for their company. If tax mobility is turned on, Carta will use a stakeholder's address history when estimating taxes for withholding purposes.

Who this affects:

Company administrators with access to the "Tax rules" page in Carta

What’s new:

  • Enable tax mobility for more accurate tax withholding estimates. Companies can turn the tax mobility feature on under Compliance > Tax rules. If tax mobility is enabled, Carta will look at a stakeholder's full address history when estimating applicable taxes for a withholding event (e.g. NSO option exercise, RSU settlement).

If you don't already have access to the "Tax rules" page in Carta, reach out to your account manager to request access.

Navigate to Compliance > Tax rules to find the tax mobility feature:

Timing:

All companies with access to the "Tax rules" page will have access to the tax mobility feature by Wednesday, February 3rd

Resources:

Carta HRIS Integrations now available to Carta admins

Carta integrations to HRIS (Human Resources Information System) Providers are now available to all users with HR Administrator or above Carta access. The HRIS Integrations we have today are one-way data synchs from either BambooHR, Namely, or Workday into Carta.

Who this affects:

HR Admins, Company Editors, and Legal Admins for all companies

What’s New:

Carta HRIS integrations are now available to users with HR Administrator, Company Editor, and Legal Administrator access. Carta HRIS integrations can:

  • Flag Terminated Employees. Employee terminations made in the HRIS appear as pending termination events in Carta
  • Flag Existing Stakeholder Updates. Employee profile updates made in the HRIS will appear as pending stakeholder profile updates in Carta

Carta HRIS integrations functionality can be enabled via the Company > Settings > Integrations page. The data pulled by the HRIS integrations is then shown in the Stakeholders > Stakeholder Updates page where, you can find:

1. Pending HRIS employee profile updates for stakeholder profiles that already exist in Carta



2. Pending terminations for employees who were terminated in the HRIS but not in Carta



Learn more about setting up each HRIS integration here:

Lastly, for Enterprise companies, Carta also supports flat file integrations with HRIS Providers that support automatic report uploads via SFTP. Contact your Carta Account Manager if you want access to the flat file integrations feature.

Using Custom Spreadsheets When Adding New Stakeholders in Bulk

What’s coming: Admins can now upload new stakeholder information using data stored in custom spreadsheets/reports 

Who this affects: All companies 

What’s better:

For companies that use HR Providers to store their stakeholder/employee information, their company admins can now upload new hire information into Carta in bulk using the HR Provider's report (xls, or xlsx) with minimal modifications.

This workflow is an enhancement to the existing Bulk Add Stakeholders flow, with a new step for users to map the columns in the report to Carta data fields.


Timing: Live for all customers Oct 20.

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