Carta acquires Silicon Valley Bank Analytics


On September 1st we acquired Silicon Valley Bank’s valuation business and team (Silicon Valley Bank Analytics or SVBA). This impacts both the former SVBA employees and the 1,300 customers that came with the acquisition.

Let me address how we got here, why we bought SVBA, and what this means for customers.

How we got here

Three years ago we entered the 409A market with the thesis that traditional valuation firms would be uncompetitive against software companies. At the time the thesis was incredulous. Now it is obvious. Manually entering cap table data and hand-building Excel financial models is error-prone and expensive. Today, calculating 409A valuations without software sounds absurd.

We collapsed the 409A valuations market into the cap table software market. Valuation firms can’t compete without offering cap table software. And cap table software companies can’t compete without offering 409A valuations. More valuations firms will be acquired or close shop. And more cap table software companies will enter the 409A market.

My guess is the pure 409A valuation firm will be extinct by the end of 2018. The cap table software companies will compete to fill the vacuum.

Why we bought SVBA

We want to do two things with the business. First, convert SVBA’s project-based 409A valuations into subscription-based valuations on our platform. This drives down the cost of 409A valuation and allows us to perform valuations within 7-10 days.

Second, provide a safe landing for SVBA customers. When valuation firms shut down, customers are left unprotected because no one is available to defend future audits. SVBA acted responsibly by selling us both their assets (the customers and employees) and their liabilities (obligations to defend 409A valuations).

What this means for customers

If you’re a former SVBA customer, it is likely that we have already contacted you. Here are our two requests:

First, allow us to continue being your 409A valuations provider. We will honor SVBA’s commitments to you and defend all of your historical valuations. We will also honor your existing pricing as long as you transition by October 15th. And we will put you on our software platform to perform all of your future valuations.

Second, once you are on our platform, learn about everything we do. Real-time cap table management, ASC 718 expense accounting, employee liquidity programs, investor relations, board meeting management, waterfall modeling, employee self-exercising, Form 3921 tax reporting, 83(b) filing, and, of course, our mobile apps (iPhone & Android).

If you haven’t heard from us already, please contact us at svb@carta.com or me directly at henry@carta.com.

I look forward to the opportunity of working with you.

Related articles


What’s Rule 701 and what’s recently changed?

Learn more about Rule 701, recent updates, and how to stay compliant at your company. Everything from the history of Rule 701 to the most recent changes.

What is a 409A valuation?

Learn everything you need to know about section 409A of the internal revenue code. From what is a 409A valuation to 409A methodologies and process.

Equity 101 – Equity Basics for Founders

Learn the basics of equity, how to distribute equity to early employees, and what a cap table is

eShares, Inc. DBA Carta, Inc. is a transfer agent registered with the U.S. Securities and Exchange Commission. The services and information described in this communication are provided to you “as is” and “as available” without warranties of any kind, expressed, implied or otherwise, including but not limited to all warranties of merchantability, fitness for a particular purpose, or non-infringement. Neither eShares, Inc. DBA Carta, Inc. nor any of its affiliates will be liable for any damages, including without limitation direct, indirect, special, punitive or consequential damages, caused in any way or arising from the use of the services or reliance upon the information provided in this communication or in connection with any failure of performance, error, omission, interruption, defect, delay in operation or transmission, computer virus or line or system failure. Transfer Agent services for DTC-eligible registered companies provided by Philadelphia Stock Transfer, a Carta affiliate. Carta Securities LLC is a broker-dealer and a member of FINRA and SIPC. Contact: eShares, Inc. DBA Carta, Inc., 195 Page Mill Road, Suite 101, Palo Alto, CA 94306.

© 2018 ESHARES, INC. DBA CARTA, INC.