Carta and NewView Partner to Simplify Startup Employee Stock Liquidity Programs

Partnership to Streamline Tender Offers

Carta and NewView Capital have announced a partnership focused on simplifying the process of tender offers for private companies. This collaboration combines NewView's experience in secondary deal structuring with Carta's equity management platform. The objective is to make it easier for startups to implement and manage programs that allow employees to sell a portion of their stock before an IPO.

Addressing Employee Liquidity Challenges

Startups are remaining private for extended periods, which can limit liquidity options for employees who receive stock as part of their compensation. Tender offers provide a mechanism for these employees, and sometimes early investors, to sell shares at a predetermined price to approved investors. This partnership seeks to address the challenge of early liquidity for employees in private companies.

Growing Trend in Late-Stage Startups

According to a study by NewView Capital and Carta, tender offers are projected to triple for Series C and later-stage startups over the next three years. While historically common among highly valued private companies like OpenAI and Databricks, this trend is expanding to other startups. Examples include Hightouch, Decagon, Wayve, and ElevenLabs, which have recently conducted tender offers.

Impact on Retention and Morale

Ravi Viswanathan, founder of NewView, stated that offering early liquidity through tender offers can serve as a retention tool and morale booster for employees. He noted that while being a unicorn once attracted talent, the increased number of billion-dollar companies means that early liquidity can now be a significant differentiator for attracting and retaining talent in a competitive market.