Who this affects
Employees and Investors
iOS & Android
Employees and Investors
iOS & Android
How it Works
Who This Affects
Why This is Awesome
Starting in May 2022, we will require that all Carta accounts have two-factor authentication (2FA), also known as Multi-factor authentication (MFA) enabled. Investor Services customers should confirm all of their team members have personal accounts properly provisioned and secured with MFA/2FA as soon as possible.
MFA is the industry standard for software companies, like Carta, that store sensitive identity and financial information.
As we make this change, all accounts need to be associated with a single person’s name.
If there are multiple people at your organization accessing Carta with the same email and password, you need to take action.
If you’re not sure, click here for instructions on checking or updating the name on your account.
You can add people on the people page of each account by following these steps.
If you are unsure about how to set up access for other members of your team, please reach out to our support team at firstname.lastname@example.org.
We cannot send MFA/2FA codes to multiple people at once.
Our Investor Services support team is happy to help you with this process. Reach out to them directly at: email@example.com.
A password on its own gives you poor protection from hackers. They can steal them from other insecure websites or via malware, and people often reuse the same password for many accounts or choose passwords that hackers can easily guess. Carta is adding this additional security to protect your account from social engineering, phishing, and other related attacks.
Thank you for being a Carta customer, and we look forward to answering any questions you might have about this change.
Soon, companies will have access to the updated Capitalization > By Share Class view. This page comes with improved performance for large Cap Tables, allowing you to view and interact with your Cap Table up to 5x faster.
To access this view, you can navigate to Capitalization > By Share Class.
We will continue to improve the experience, adding a new summary visualization to the top of the page, and improving the navigability between the By Share Class and the By Stakeholder Cap Tables.
Support Article: Capitalization Table - By Share Class
Users with holdings in companies identified as Qualified Small Businesses (QSB) will now be notified of the potential tax benefit. Carta determines QSB eligibility when performing a 409A valuation and email notifications will be sent to all users associated with the company once the valuation is accepted. In addition, vesting emails will include information about the qualified small business stock (QSBS) tax benefit.
Furthermore, users can now find a banner in the company overview page within their portfolio that informs them about QSBS eligibility, linking to a blog post to learn more. Finally, users will be notified if their exercise qualifies for QSBS once they submit an exercise request.
US Companies using Carta for 409A valuations that are QSBS eligible and all their stakeholders, prioritizing “Vested” option holders.
Emails are sent to all users associated with a company that qualifies as a QSB. If Carta determines the company is a qualified small business, emails are sent once the 409A valuation is accepted. Extra emails are sent to all users each time the company’s valuation includes eligibility.
Vesting emails will now include information about QSBS eligibility to help make a more informed decision about exercising.
A banner informing users of the QSBS Eligibility Tax Benefit can be found next to the company’s name in their portfolio. This banner appears for companies identified as qualified small businesses, including information about the potential tax benefit from exercising and the expected timeframe of the company’s eligibility.
Upon submitting an exercise request, the Congratulations page will inform users that the shares are QSBS-eligible. It summarizes the conditions and links to an Equity Education article to learn more (highlighted in red).
Previously, our capital call request tool only allowed General Partners (GPs) to request capital from all investors in the fund regardless of their close date. Starting today, GPs can use the redesigned tool to:
Additionally, GPs will be able to view a list of all their newly closed investors, as well as any investors whose commitments have increased or decreased since the last capital call. The capital call amounts to be called from these investors will be auto-calculated by the tool for the GP to review.
How it works
Select the type of capital call you would like to request:
Who this affects
This is available for all fund administration customers who are on the Carta General Ledger.
We’ll be expanding the tool’s functionality to handle more complex scenarios, such as calling additional capital from both new and existing investors in the fund. We also plan to embed the PDF notices at the review step to give GPs the option to start the capital call without further approvals.
Soon, Carta customers will start seeing an expanded set of Roles to help you reflect the different individuals who are handling different aspects of Cap Table management.
For now, users assigned to new roles will serve as point of contact for their areas. Over time, these individuals will see updated experiences and be guided to relevant Carta tools.
To see this experience, Navigate to "Company > Permissions and Roles > Roles"
If Company tax data is not complete:
If Stakeholder tax details are not complete, update missing data under the Stakeholder details tab of the same Form 3922 page
5. If the missing data was entered in, return to the Compliance > Section 6039 page and click Generate to click through the steps to proceed and add company contact information. The company contact is formatted into the electronic Copy A .txt file that will be uploaded to the IRS site.
Click Generate Form 3922 to begin the generation of the files.
6. Refresh the page after some time if you see a spinning wheel or navigate away and return later.
7. Once generated, click Download reports for the tax year to download a .zip file to your local drive that contains all necessary data for Copy A (efile), and Copy B (statements).
The .zip file will be split out into the following three files:
For any filing questions, contact your tax advisor.
Public and Private Market companies with an ESPP.
This feature can be enabled on demand by reaching out to our support team or Customer Success Managers.
The product team will be enhancing Form 3921 functionality to bring it more in line with the new Section 6039 admin experience.
LPs subscribing to Funds and SPVs using Carta's Closings Tool can now E-Sign a pre-filled W-9 while filling out subscription documents.
Having LPs submit a tax form is an important part of the closings process for any Fund or SPV to ensure tax teams correctly prepare LP K-1s. We received feedback from LPs about the friction of printing, signing, and uploading W-9s and wanted to streamline the process.
For U.S. based LPs subscribing as an Individual, we can now optionally pre-fill a W-9 for them to review and E-sign in just three clicks. The W-9 is pre-filled based on the information the LP already provided as part of their subscription.
For Partnerships and LLCs
For LPs subscribing as a partnership or through a LLC we'll ask some additional questions to ensure we are accurately representing the LPs federal tax classification on the W9.
With the initial release of this product we will not be pre-filling W-8s or W-8BEN-Es for non-US LPs but will still allow them to upload their own form.
This is now available to any LPs using Carta's Closings Tool. The Closings Tool gives LPs a quick and easy way to fill out Fund and SPV subscription documents.
Valuation updates can now be submitted directly in Carta!
We kicked off EoY reporting by launching Schedule of Investments (SOI) review emails with in-app flows for Fund Managers approve their valuations, markup their investments, or request other updates right in Carta. This is the first step in a set of functionality for making the quarterly and annual reporting process easier than ever.
How it works:
Rather than Fund Admins having to comb through investment valuations for every entity and curate one-off email threads with Fund Managers to ask for reviews and updates, they can now kickoff these emails with just a few clicks in Carta, and easily track where each entity is in the reporting process.
Fund Managers will be sent a link to their SOI for review and approval, where they can approve on the spot or request changes directly in app. For markups or markdowns, they can go through a fully in-app flow to complete the updates. They no longer need to go download their SOIs and itemize every change through email, to send back to their Fund Admin.
Any approvals or requests for changes will automatically be queued for Fund Admins to review and push through, while markups and markdowns that pass health checks will push through updates directly and be routed to Carta's Deal Docs team, so they can review and catalogue supporting documentation.
Who does this impact?
Fund Admins now have quicker, more efficient ways to send out SOIs to kickoff financial reporting, and track where each of their entities are in the process. They can spend less time keeping track of multiple email threads and keeping mental lists of which assets are ready to go and which need to updated.
Fund Managers can also view their SOIs by fund and directly request changes at any time, within Carta as needed, ensuring asset valuations are up to date throughout the year.
The team is working to add more in-app methods for funds to easily to keep their investment valuations up to date, such as note conversions, further reducing the time delays from back and forth emails, and ensuring better expediency and accuracy for valuation updates.