{"id":1516,"date":"2019-05-07T00:00:00","date_gmt":"2019-05-07T00:00:00","guid":{"rendered":"http:\/\/www-staging.carta.com\/sg\/blog\/fund-admin-is-broken\/"},"modified":"2021-03-05T06:57:56","modified_gmt":"2021-03-05T06:57:56","slug":"fund-admin-is-broken","status":"publish","type":"post","link":"https:\/\/www-staging.carta.com\/sg\/blog\/fund-admin-is-broken\/","title":{"rendered":"Fund administration is broken"},"content":{"rendered":"\n<p>Four years ago I wrote <a rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\" href=\"https:\/\/www-staging.carta.com\/sg\/blog\/broken-cap-tables\/\" target=\"_blank\">broken cap tables<\/a>. Since then Carta has fixed cap tables for 11,000 companies and counting. We\u2019ve issued securities to over 700,000 shareholders, and electronic securities and <a href=\"https:\/\/www-staging.carta.com\/sg\/cap-table\/\">cap table software<\/a> have become ubiquitous. <br><\/p>\n\n\n\n<p>Software changed how companies manage cap tables. Now, it\u2019s about to change how VCs run their funds. <br><\/p>\n\n\n\n<h3><strong>Blind spots<\/strong><\/h3>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img src=\"https:\/\/www-staging.carta.com\/sg\/wp-content\/uploads\/sites\/9\/2019\/05\/Fund-Admin-Stuck-in-Past.png\" alt=\"\" class=\"wp-image-12841\" title=\"\"><\/figure><\/div>\n\n\n\n<p>Money movement is convoluted. Today, VCs can tell a limited partner that they invested $10M and it\u2019s now worth $20M. But that limited partner can\u2019t easily see where their money is invested. A major LP like a university endowment might have four different funds invested in Uber, but they can\u2019t tell you exactly how much they would benefit from Uber\u2019s IPO. <br><\/p>\n\n\n\n<p>And if you ask an LP how their investment is performing right now, on May 8, they likely won\u2019t have an answer until the end of July. First the quarter has to wrap, then junior accountants have to manually enter data, and then the LP gets the updated <a href=\"https:\/\/www-staging.carta.com\/sg\/blog\/internal-rate-return-irr-calculator\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"IRR (opens in a new tab)\">IRR<\/a>, a month after the quarter ends.<br><\/p>\n\n\n\n<p>This goes the other way too. As a founder, I don\u2019t know where VC money comes from. It could come from my rival university, or worse, an investor that doesn\u2019t align with the ethics of my company. <br><\/p>\n\n\n\n<p>Founders, VCs, and LPs need transparency. <br><\/p>\n\n\n\n<h3><strong>A better way<\/strong><\/h3>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"aligncenter\"><img src=\"https:\/\/www-staging.carta.com\/sg\/wp-content\/uploads\/sites\/9\/2019\/05\/Fund-Admin-Now.png\" alt=\"\" class=\"wp-image-12842\" title=\"\"><\/figure><\/div>\n\n\n\n<p>We\u2019ve built a <a href=\"https:\/\/www-staging.carta.com\/sg\/fund-administration\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">fund administration<\/a> product and team to fix this. <br><\/p>\n\n\n\n<p><a rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\" href=\"https:\/\/www-staging.carta.com\/sg\/blog\/seriese\/\" target=\"_blank\">Our ownership network<\/a> sets us up to solve the problem quickly. About 90% of VC firms in the U.S. have already accepted a security on Carta. And we just follow the model for how we built our <a href=\"https:\/\/www-staging.carta.com\/sg\/409a\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">409A business<\/a>\u2014combining technology and services. Carta automates the manual parts of fund admin, and your firm partners with our experienced fund administrators.<br><\/p>\n\n\n\n<p>VCs can see real-time IRR instead of waiting for quarterly updates. And they can <a href=\"https:\/\/support.carta.com\/sg\/s\/article\/issue-a-capital-call\" target=\"_blank\" rel=\"noopener\">run capital calls<\/a> and <a href=\"https:\/\/support.carta.com\/sg\/s\/article\/share-documents-with-lps\" target=\"_blank\" rel=\"noopener\">share documents<\/a> with LPs. All on the Carta platform. <br><\/p>\n\n\n\n<p>Carta\u2019s goal is to transform private markets by increasing liquidity and transparency. First, for companies and their shareholders, now for VCs and their LPs. <br><\/p>\n","protected":false},"excerpt":{"rendered":"<p>With Carta, VCs can see real-time IRR instead of waiting for quarterly updates, work with our experienced team, and run capital calls and share documents with LPs.<\/p>\n","protected":false},"author":11,"featured_media":1892,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[8,66],"tags":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/posts\/1516"}],"collection":[{"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/users\/11"}],"replies":[{"embeddable":true,"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/comments?post=1516"}],"version-history":[{"count":0,"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/posts\/1516\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/media\/1892"}],"wp:attachment":[{"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/media?parent=1516"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/categories?post=1516"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www-staging.carta.com\/sg\/wp-json\/wp\/v2\/tags?post=1516"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}