Carta, an equity management platform last valued at $7.4 billion, has cut 10% of its staff, confirming earlier rumors that the workforce cuts being made. Using LinkedIn data, lay off may have affected about 200 employees.
Today’s layoffs are on the same scale as 2020 workforce cuts an event that CEO Henry Ward then partially attributed against a drop in new customers due to the impact of the coronavirus on business. Years later, Ward has the same tune.
In an email to employees today, obtained by TechCrunch, the CEO said that “if our customers are affected, so are we. And right now, the entire tech and venture ecosystem is struggling.” The company claims that it has cut travel costs, supplier spending, marketing spend, and invested in new bets, but ultimately it has to reduce headcount.
Severance packages include 2.5 months of severance plus one week of severance for each year of service completed and extended mental health services. For those who rely on Carta for visas, a 30-minute consultation with an immigration advisor. Those not affected by layoffs have the option of voluntarily resigning, with the option of a severance package.
The well-funded company is dealing with more than just the macroeconomic conditions that have prompted thousands of tech companies to lay off employees.
As TechCrunch reported earlier today, Carta is suing its former CTO, Jerry Talton, who was fired “for cause” nearly three weeks ago, on December 23, according to the company. In Carta’s lawsuitThe company mentions that Talton’s “wrong and illegal acts as chief executive officer of Carta” include sexual harassment of employees and betrayal of the company.
It doesn’t help that a number of users of Carta’s services, from cap board managers to fund managers, have been unimpressed with the platform in recent months. TechCrunch spoke to a fund managermoved away from the platform, who claims that his team has four different account managers on a contract of less than two years, which “certainly doesn’t help with continuity nor understanding of the fund and its needs.” our request.”
According to Crunchbase data, Carta has raised $1.1 billion from venture capitalists, including most recently Silver Lake’s $500 million Series G. Other investors in Carta include Andreessen Horowitz and Lightspeed Venture Partners.
Significant upside support, as this bear market reminds us time and time again, is not necessarily a competitive advantage. card, embroiled in lawsuits in the past and is currently taking on a current challenger, so it is perhaps not surprising that it has attracted so many competitors in recent years.
Its closest competitor, AngelList Venture, has raised significantly less capital, around $200 million. When TechCrunch asked AngelList Venture CEO Avlok Kohli about Recent product changes put it in competition with Carta, he shrugged – adding that he had nothing new to add. “Ultimately, there will be a handful of people who are truly capable of building a calculated product,” Kohli said in a previous interview. “When I say capability, I don’t mean technical ability, but institutional knowledge to build something.”
The difficulty of building a company in the venture service scene is only further demonstrated by the recent closure of Assure, a fintech company that has helped investors issue special-purpose vehicles. According to Axios, Assure did not give any reason to investors behind the closure other than the following statement: “The industry has grown significantly in the more than a decade since we founded the company. Current market conditions have led Assure to evaluate its business model.”
Let’s see if the growth of the industry, with more competitors and graveyard companies, is the driving force that Carta can keep up with.
