{"id":1364,"date":"2017-01-25T00:00:00","date_gmt":"2017-01-25T00:00:00","guid":{"rendered":"http:\/\/www-staging.carta.com\/sg\/blog\/a-carta-409a\/"},"modified":"2021-03-05T06:58:52","modified_gmt":"2021-03-05T06:58:52","slug":"a-carta-409a","status":"publish","type":"post","link":"https:\/\/www-staging.carta.com\/sg\/blog\/a-carta-409a\/","title":{"rendered":"The art and science behind a Carta 409A"},"content":{"rendered":"\r\n

A common saying in the valuation industry is that 409A<\/a> is both an art and a science. At Carta we combine art with science to produce over 200 AICPA compliant, audit-defensible valuation reports every month. This post breaks down the art and science behind a Carta 409A<\/a>.<\/em><\/p>\r\n

The Art: collecting data and selecting methodologies<\/h3>\r\n

Companies begin the Carta 409A process by submitting a request form. The form includes structured data like peer public companies, projected financials, and balance sheets.<\/p>\r\n

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Companies can connect Carta to QuickBooks or Xero. Connected financials let the data to flow directly into Carta, eliminating the risk of data entry errors.<\/p>\r\n

Once the request is submitted, a Carta analyst will schedule the kick-off call. Analysts review the request form before the call to address any outstanding questions. Any intangibles like projected changes to your business are covered on the call.<\/p>\r\n

The Science: how we use software to inform decisions<\/h3>\r\n

Every valuation requires unique inputs and methodologies. These are selected and reviewed by our team of analysts. There are a few steps, however, that can be improved with software.<\/p>\r\n

Determining volatility is one of them. Traditionally, valuation firms will select a list of peer public companies and manually pull their volatility measures. At Carta, our analysts still select the peer public companies, but use a software integration with Capital IQ<\/a> to pull the volatility measures.<\/p>\r\n