Every quarter, VC and PE firms fight the same enemy: fragmentation. Data trapped across a dozen disconnected systems that don't talk to each other. Someone has to chase portco financials from a dozen different formats, rebuild valuations from scratch, and reconcile waterfall calculations against operating agreements, all under audit pressure.
Here’s an example: Delta-v Capital was manually populating 28 separate spreadsheets each quarter before Carta. That's a data architecture problem that generic AI tools have made worse, not better, because they have nothing reliable to read from. Connected data in a single system of record is the prerequisite. That's where Carta starts, and it's why AI finally works here.
Building AI for the middle office
Most firms operate with three disconnected "sources of truth": portfolio cap tables for equity, the general ledger for cash, and LP portals for ownership. Carta collapses these into one system of record, grounded in actual transactions rather than summaries of them. That's the foundation AI needs to work here at all. When you ask how many investors you have or how much was invested last quarter, you shouldn't get a different answer depending on which system you open. AI is only as effective as the data it operates on.
The complexity that initially made the middle office resistant to AI is exactly why it’s valuable when executed correctly.
For example, generic AI wrapped around a spreadsheet can’t handle the rigorous methodologies of fair value accounting or dynamically apply operating agreements to carry structures. It can’t track holdings and proceeds across look-through ownership structures without risking errors or just breaking.
Similarly, LLMs are often probabilistic, estimating outcomes based on pattern recognition. They hallucinate, miss edge cases in operating agreements, and lack an audit trail.
But when AI is built into your system of record, it can act deterministically, replacing inconsistencies, guesswork, and errors with integrated accuracy across all of your fund accounting.
There's also a deeper architectural question that most vendors avoid. The conventional approach is to keep the existing web application intact and bolt agents onto the backend: users still log in, click around, and trigger automation from inside the software. Carta doesn't believe that's the future. The agent frameworks running on desktops today (Claude Desktop, Codex, and others) are, in effect, a new operating system. Firms will increasingly run their own agent loops directly, pulling data and executing workflows through those frameworks rather than through web interfaces.
Carta is built for that modality, because Carta's system of record is the source the agents read from and act on. The value compounds as that shift accelerates.
Connected workflows support speed and accuracy
Fragmented or bolt-on AI tools struggle to organize information well, especially if you don’t have all of your data in one place.
Integrating AI into your fund infrastructure turns traditionally isolated or stitched-together taskwork into a single sequence:
Data collection and ingestion: Whether you're a VC firm collecting from dozens of portfolio companies each quarter or a PE firm consolidating a handful of complex deals, financials and operating KPIs are already in your records, so a single action can prefill a valuations module in bulk, maintaining explicit, clickable traceability to uploaded source documents.
Methodology-driven valuations: Integrated fund accounting determines calculations by pulling cap table snapshots and data from sources like CapIQ automatically. Clear valuation methodologies, such as DCF, guideline public company multiples, backsolve, and custom weightings, ensure consistency and accuracy across all fair value and financial assessments.
Multi-entity waterfall allocations: Carta's deterministic scripts allocate proceeds across aggregators, holdcos, AIVs, and co-invest SPVs, evaluating both legal and economic ownership between entity nodes down to the operating company level and applying both cap table records and operating agreement rules. AI orchestrates the workflow. For each portfolio company, a custom waterfall model is configured in Carta—standard for most PE-backed structures, and the foundation that makes the full allocation workflow possible. A Deal Group Entity Map and Portco Entity Map let you separately track the firm-side LP vehicle structure and the portfolio company entity structure at a glance.
Finalization and accounting: Once finalized, a journal entry posts directly to fund records and the Schedule of Investments updates automatically.
Data warehousing: All of this data (portco financials, valuation inputs and outputs, waterfall results) lands in Carta's Data Warehouse automatically. This is your single source of truth where fund data and portfolio data are unified, queryable, and ready for the analysis layer described below.
In this sequence, each step directly feeds the next, creating an end-to-end workflow that eliminates the errors and gaps of manual handoffs.
AI enables more strategic analysis
With AI sitting on top of Carta's Data Warehouse, the single source of truth spanning your fund and portfolio data, you can ask questions in natural language to analyze funds without manual research and custom models. LLM capabilities work here because calculations and other information are reliable and easily traceable back to solid methodologies.
Query which portfolio companies outperform on MOIC and instantly retrieve peer benchmark percentiles.
Calculate net cross-entity IRR across different investment vehicles in seconds.
Work directly inside spreadsheets via Claude for Excel, pulling live cap table data, financials, and comps, and running exit waterfalls via Carta without copy-pastes or leaving the sheet.
Model management company budgets from prior-year actuals, complete with live variance tracking and bear/base/bull scenario modeling you can generate via prompts with editable assumptions.
These capabilities can also shift the middle office toward more insightful contributions to the firm, enabling CFOs to also shift focus toward more strategic capital allocation and other executive activity.
Moving forward with AI you can trust
The critical technical distinction when using AI in the middle office is whether the solutions you choose estimate calculations or give you numbers you can trust.
With Carta, calculations run via deterministic scripts built directly on the core database engine. AI handles intent and workflow orchestration, but never guesses mathematical outcomes.
Waterfall traceability: You can see the exact mathematical progression of every payout, preferred return hurdle, and GP carry allocation. Liquidation preferences, participation rights, and catch-ups are transparent and easy to review.
Verifiable audit trails: Every journal entry, valuation adjustment, and waterfall output traces directly back to the underlying event or source record.
Real-time system of record: Calculations operate on live fund records, the same data verified during annual audits, to eliminate version control risks.
These features deliver the accuracy the middle office demands. Now that Carta has encoded AI to perform precisely, private equity firms can advance their operations reliably.
DISCLOSURE: This communication is on behalf of eShares, Inc. dba Carta, Inc. ("Carta"). This communication is for informational purposes only, and contains general information only. Carta is not, by means of this communication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services nor should it be used as a basis for any decision or action that may affect your business or interests. Before making any decision or taking any action that may affect your business or interests, you should consult a qualified professional advisor. This communication is not intended as a recommendation, offer or solicitation for the purchase or sale of any security. Carta does not assume any liability for reliance on the information provided herein. ©2026 Carta. All rights reserved. Reproduction prohibited.
