Andreessen-Backed Carta Said to Seek Funds at $3 Billion Value

(Bloomberg) -- Carta Inc., a startup that makes software to manage equity stakes in other startups, is seeking to raise as much as $200 million in a new funding round at a far higher valuation than it had last year, according to people familiar with the matter.

The company is speaking to existing investors including Tribe Capital and Lightspeed Venture Partners, said the people, who asked not to be identified because the matter is private.

One valuation for Carta being discussed with investors would put it at $3 billion, a major bump from its $1.8 billion worth last year, the people said. These funding plans haven’t been finalized and could still change, they said.

Representatives for Carta, Tribe and Lightspeed declined to comment on funding talks.

The talks come as Carta is firing employees, making it the latest technology startup to shrink its workforce during the coronavirus pandemic.

“Today we are going to lay off 161 Carta employees which is 16% of our company,” Carta Chief Executive Officer Henry Ward wrote in a memo Wednesday to employees that was viewed by Bloomberg.

‘Slower Economy’

Ward said that a “slower economy” affects different parts of the business and it tried to figure out the right headcount in each department that could be supported with fewer customers.

“We exist only because our customers exist and allow us to serve them,” he wrote. “And when our customers suffer we suffer too.”

Carta will provide three-months pay and health-care coverage until the end of the year for the affected employees.

Startups have been hit particularly hard during the crisis. An estimated 23,000 employees were let go at 241 startups since March 11, when the the coronavirus was declared a pandemic. That figure comes from Layoffs.fyi, a tracker that measures publicly announced job cuts. The actual total is likely far higher because not all companies have made public announcements.

San Francisco-based Carta counts Marc Andreessen, a co-founder of venture capital firm Andreessen Horowitz as a backer and board member. Carta, previously known as EShares, declined to comment further.

$300 Million Round

The company, founded in 2012, helps venture capitalists, as well as startup employees, track and manage the shares that they own. Companies also use to manage other aspects of their stock, such as fair-market valuations and secondary sales. It has been trying to build a private stock market.

Last year, the financial technology company raised a $300 million round of funding led by Andreessen Horowitz at a $1.8 billion valuation.

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