In an aim to make exercising simple and easy to understand, we are excited to support simulation tools on iOS and Android apps.

This release will allow any option holder on iOS or Android app to view the estimated cost and taxes by simulating an exercise before performing it. 

There are three different scenarios available through the simulator depending on the type of the grant(s).

• All Vested Options
• Early Exercise all Options
• Customize your exercise

While All Vested Options and Early Exercise All Options allow users to simulate a fixed number of options based on the selected date, Customize your Exercise allows users to manually enter the number of options they plan on exercising.

Once the preferred scenario is selected and additional tax information has been provided, the cost and taxes for that exercise are calculated.

Goal: Allow users to merge their portfolios and view holdings in one view.

Audience: 

• Users: Equity holder, Employees, Investors (Corporations), Investors (Fund Admin), LP
• Companies on Launch, Starter, and Growth 
• Platforms: Web, iOS and Android

What’s New: Users will now be able to merge multiple portfolios into a single one using the self-serve portfolio merge tool.

• Organization: Organize and view different company holdings in a single portfolios 
• Customization: Customize portfolio views by selecting which portfolios to merge

Timing: Rolled out on 09.24.2020

Resources: https://support.carta.com/s/article/merging-portfolios

Corporations  Early Access 

Carta now supports performance awards with variable payouts

What’s New: Here are the highlights for Carta’s updated performance award module.

• Manage performance awards from a single, unified modal
• Support variable payouts
• Streamline award management with updated UX
• Updates to vesting modals for admins and participants
• (Coming soon) Custom vesting schedules with performance conditions
• (Coming soon) Milestone vesting with performance conditions

Manage performance awards from a single module

Carta’s new performance award functionality allows administrators to manage performance criteria and payout from a single module. Performance criteria can be created and applied to multiple vesting schedules and many grants at once. Awards sharing the same performance criteria are all managed from a payout perspective from a single action:

Support variable payouts

Carta now supports variable payouts for performance awards. Performance awards can be configured to allow for payouts at greater than or less than 100% of target. 

Note: Carta will initially reserve shares from the plan’s share pool at the maximum payout amount.

Streamline award management with updated UX

Performance conditions can now be created and tied to vesting tranches:

Performance conditions now can have both variable (pay out at greater than or less than 100%) or non variable payouts. Performance conditions can be attached to multiple vesting schedules; achievement is governed by managing the condition itself and flows back to all affected tranches for vesting:

The performance condition(s) are then tied to a vesting schedule or individual vesting tranches:

Associating grants with a performance vesting schedule will allow administrators to manage condition achievement by evaluating the condition itself. Performance tranches on the award will not pay out until the related performance criteria are achieved: 

Updates to vesting modal for admins and participants

Prior to achievement of a performance condition, the vesting modal will show no shares vested for tranches tied to performance conditions. The progress table will indicate the performance condition that is tied to each tranche, and will show the potential amount that can be earned. 

Following the evaluation of the condition, tranches that have met both the time and performance conditions will show as vested and will allow exercise (if options) or release (if RSUs). The following screenshot shows the condition “Liquidity Event” as achieved on 9/16/2020, allowing the tranches that have met both the time and performance based conditions to vest: 

Coming soon

While this initial release covers performance awards and standard vesting templates, we will soon release additional functionality. This includes the ability to associate performance conditions with custom vesting templates and schedules, as well as combining performance conditions with milestone vesting events. An upcoming entry will cover these items.

What's coming: 

Make more informed decisions when reviewing and approving option exercise requests with key information at your fingertips

Who this affects:

Users with the "Option exercise approver" role in companies issuing stock options with online exercising enabled

What's better: 

• The ability to approve or reject exercise requests
• Information about the option grant and stakeholder is readily available
• Clearer presentation of information

New exercise approval screen:

Previous exercise approval screen:

Timing: 

• Rolling out to 10% of customers on September 28, 2020
• Release percentage will slowly increase to 100%

What’s coming:

A simple way to manage 83(b) elections for Profits Interest Units

Who this affects:

• LLCs
• US-based equity holders who are issued Profits Interest Units

What’s new: 

• 83(b) file management
  Equity holders and admins now have a dedicated place for 83(b) elections for Profits Interest Units. On the PIU modal, users will see an 83(b) elections tab where they can access the generated 83(b) election form and upload a signed copy for their issuing company and personal records.
  
  
• 83(b) template for PIUs
  Carta generates a PDF template based on the information in the platform.
  
  
• 83(b) reminders
  Timeliness is important for 83(b) elections. Equity holders will see various reminders in-app and by email highlighting 83(b) eligibility.
  
  
  
  
  

• Filtering on 83(b) filing status
  For company administrators, it is easy to filter PIUs based on the 83(b) filing status.
  

  

  
  

What’s coming: 

• This scenario modeling tool helps founders predict the future impact of Safe and Note ownership when converted at a future priced round. 

Who this affects: 

• Users: Equity administrators, Law firm partners
• Packages: All packages (Launch, Starter, Growth, Scale, and IPO-Ready will receive this calculator)

What’s new: 

• View pre and post-money dilution before and after a future priced round, visualizing your ownership at multiple future valuations.
• Model multiple Notes or Safes and a priced round to account for all anticipated fundraising activity between now and the completion of a future priced round.
• Assess the potential impact of different types of convertibles, including pre-money Safes vs. post-money Safes.

Timing: In September, all companies received access to this calculator.

Calculation Definitions For Reference:

Option Pool Increase
(Target Available Pool % *  Post-Money Fully Diluted Shares) - Available Options

Post-Money Valuation
Preferred Price Per Share * Post-Money Fully Diluted Shares

Preferred Price Per Share
Pre-Money Valuation / (Current Fully Diluted Shares + Option Pool Increase+ Converted Shares)

New Fully Diluted Shares
Current Fully Diluted Shares + New Money Preferred Shares + Option Pool Increase + Converted Shares

Conversion Price Per Share (Convertible Notes and Pre-Money Safe)
Lower of:

• (1 - Conversion Discount) * Preferred Price Per Share
• Valuation Cap / (Outstanding Shares + Outstanding Options +Available Options + Option Pool Increase)

 Conversion Price Per Share (Post-Money Safe)
Lower of:

• (1 - Conversion Discount) * Preferred Price Per Share
• Valuation Cap / (Outstanding Shares + Outstanding Options + Available Options + Converted Shares)

Safe/Notes Ownership:

• Convertible Note Converted Shares / New Fully Diluted Shares
• Safe Converted Shares / New Fully Diluted Shares 

Safe/Note holders post-priced round

Converted Shares / New Fully Diluted Shares

New investors post-priced round

New Money Preferred Shares / New Fully Diluted Shares

Your post-priced round ownership

Founder Shares / New Fully Diluted Shares

Dilution of Founder Shares

(% change in Founder Ownership / Current Fully Diluted Shares) * 100

Value of your shares post-priced round

Founder Shares * Preferred Price Per Share

What’s coming: We've made a few changes to our login screen to help users get access to their Carta account. We want to make sure your first interaction with Carta is clear, simple, and secure.

Who this affects: 

• All Users accessing the login screen.

What’s new:

• Added a new link to help troubleshoot log in issues and contact support.
• Updated the show password toggle to an icon to simplify the page layout. This is consistent with our designs also on our registration page.

  
  
  
  

New log in page

Previous log in page

What’s coming: 

• Drafting securities enhancements: in-app spreadsheet and data validations.
• Option grant and RSU drafting available now. Certificate drafting coming soon.

Who this affects: 

• Users: Equity administrators, Law firm partners
• Packages: All packages (Launch, Starter, Growth, Scale, and IPO-Ready will receive this new drafting flow)

What’s better: 

• In-app bulk actions for large data sets: This new and improved drafting and issuance workflow includes an in-app spreadsheet. 
• Built-in data validation: We’ve built advanced validations into the product to improve data accuracy and completeness of your entire cap table.

Timing: So far in 2020, about 12,000 customers have received access to Drafts V2.  All remaining clients will be enabled in Q4 2020.  If you'd like to learn more or to request access sooner, email us at draftsfeedback@carta.com

What’s coming: Let your employees know your 409a is out of date and their taxes may be impacted if exercising.

Who this affects: 

• Users: Equity administrators and option holders
• Packages: Starter, Growth, Scale, and IPO-Ready will receive this functionality.  Any customer with 409a in their subscription.

What’s better: 

Proactive, in-app communication: When enabling this functionality, all option holders, upon exercising, are shown a disclaimer that the FMV is stale and this could impact their taxes. See the full disclaimer below in “Option Holder view”.

Equity Administrator view:

Option Holder view:

Timing: Rolling out to all 409a customers on September 30th.

What's coming: Carta will automatically check for the ISO 100k limit in additional workflows and features across the app

Who this affects: Companies issuing ISOs

What's better: 

Based on some inputs (FMV, number of options granted, etc.), Carta automatically detects whether or not any grants for a given stakeholder are in violation of the ISO 100k limit. If any ISO grants are in violation of this rule, Carta will automatically change the award type from ISO to ISO/NSO:

Carta already runs this automated check any time a new award is issued. We've added this automated check in a few more places, so companies will no longer need to work with Carta staff to manually run the check when making common types of award modifications.

Timing: Live for all customers on September 15th