Nate Vasel, explains how Las Olas used Carta for fund administration and a capital call line of credit.
The venture capital industry prides itself on funding innovative companies, but capital call lines of credit—the loans that finance many VC investments—haven’t changed for decades. Carta is already in the business of helping you run your fund, now we’re offering capital call lines, too — and we’re doing things a little differently.
Traditional capital call lines have lots of fees; complex bespoke term sheets and legal agreements; and negotiations that tend to favor those who rub shoulders with private bankers. There’s a lot of negotiating and little transparency into how most banks ultimately decide what price and terms you get.
With Carta, everyone gets our best offer, which includes fair and transparent terms. See if you’re eligible.
Read the terms
Get access to our standard Loan and Security Agreement (LSA), our terms explainer, the loan process, and our pricing philosophy
Why get a capital call line of credit from Carta?
With Carta capital call lines you can expect:
- One price. Everyone gets our best offer. Borrow at PRIME minus 0.75%, plus a $2,000 subscription fee per $1M of facility, and a one-time $3,000 line closing fee.1
- One day. Complete the loan application, review and accept our standard terms and price, and sign the loan documents in as little as one business day.2
- One provider. Bundle your fund administration and capital call line providers to manage fewer vendors and make your back office more efficient.
How does it work?
Everyone gets our best offer, which includes fair and transparent terms.
We’re standardizing all legal documents, so there’s no more back and forth. Our standard terms and one price are straightforward and transparent. All customers get the same price without a preference for size, name-recognition, or connections.
Carta charges two fees:
- An annual subscription fee instead of several variable and confusing fees (like facility fees, unused line fees, and fees each time you draw down the loan).3
- A one-time, fixed $3,000 fee to cover closing costs.4 Because we don’t negotiate terms, our legal closing costs are consistent and predictable.
More importantly, we’re not a bank so we’re not in the business of making money from interest. All capital call loans have an interest rate of PRIME minus 0.75%—our cost of capital. We’re simply passing along our cost of financing.
We charge a subscription fee to cover servicing costs like same-day fund transfer, account statements, customer service, and our proprietary software. You can request an advance, initiate a payback, and more in the Carta app.
To bring you these loans, we’ve partnered with Coastal Community Bank, Member FDIC, a Washington state-chartered bank. You’ll sign the loan agreement with Coastal, who will be your lender. Carta will guide you through the loan application process and provide administrative services and software.
Here’s what you can do in-app:
Line of credit dashboard
See an overview of loans across your funds, including outstanding balance, available credit, interest balance, and due date for each loan.
Request an advance
Request an advance in-product. Funds can be wired same-day.5
Initiate a payback
Initiate the loan repayment in-app. Choose to repay either the full outstanding balance or just a portion.
Track your transaction history
See details of each loan like your interest rate, borrowing base, active and historical advances, transaction history, and more.
If you’re interested in a line of credit, start the process.
Carta is the only provider that offers both capital call lines of credit and fund administration to venture capital funds. Together, these services can streamline your fund’s cash management. Carta’s dedicated team of fund administrators will partner with you to help you meet your goals.
If you have any feedback, please reach out to us.
1 Closing fee is per loan, fee is waived for renewals.
2 24 hour turnaround time begins upon receipt of all required information, and excludes federal holidays and office closures. Current Carta Fund Admin customers can close in as little as one business day. New Carta customers may require additional time due to our diligence requirements.
3 Except, of course, if you miss a payment, in which case late fees may still apply.
4 Closing fee is per loan, fee is waived for renewals.
5 If an advance request is received by 12 PM PT Monday through Friday, excluding federal holidays and office closures.
DISCLOSURE: This communication is made on behalf of Carta Financial Technologies, LLC (“Carta Financial”), a wholly-owned subsidiary of eShares, Inc., dba Carta, Inc. and is for informational purposes only. Carta Financial offers capital call lines of credit through a strategic partnership with Coastal Community Bank, Member FDIC, Coastal will be your lender. Carta Financial is not providing legal, financial, accounting or tax advice or any other professional advice or service. Neither Carta, Inc. nor Carta Financial assumes any liability for reliance on the information provided herein. This communication is not intended as a recommendation, offer or solicitation for the purchase or sale of any security.
Carta Financial’s obligation to provide a capital call line of credit to you will be subject to customary conditions, including but not limited to Carta Financial’s satisfactory completion of due diligence on you, your general partner and your LPs, there being no material adverse change in your business/financial condition and final, executed loan documents. Also, by submitting an application for a capital call line of credit, you will be authorizing Carta Financial to review all information that pertains to you and your partners that you provide to or receive from any Carta Financial affiliate.
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