Uncertainty is part of life for many startups. If you’re a leader of a private company, you likely understand this well.
Growing a business is difficult even in the best of times. Now add some volatility — geopolitical uncertainty, high interest rates, investor wariness — and the stakes are raised. Balancing everything required to run your company, secure investment, and extend your runway can feel a little stressful.
Your “things to worry about” list might feel like it's growing. Fidelity Private Shares℠ is committed to helping founders and company leaders take “equity management” off that list of worries. You can spend less time fretting over the security or privacy of your cap table data and company documentation.
Let’s explore the need for stronger infrastructure in the world of startup equity, and discuss why many private companies trust Fidelity for their equity management needs:
The importance of trust in equity management
Startup equity usually transcends percentages, shares, and voting rights. Equity management should typically be a people-first process that’s augmented by software that founders can confidently use. Here’s why:
A clean cap table and data room can keep you fundraising-ready.
With something as important as the ownership of your company, you likely want to trust the software you’re using.
Startup leaders aren’t the only ones who need to trust their equity management solution; investors typically feel confident in your company’s equity management process before they agree to write you a check.
Some investors view the due diligence process as a microcosm for how you run your company. You could send the wrong signals to potential investors if you’re scrambling to update your cap table and organize your vital documents.
On the reverse side, using the right equity management tools can set you up for success. Setting up an automated data room in your equity management software can help you stay organized and keep everything you need for fundraising in one place.
If you’re using a 409A valuation, it must be reliable.
A 409A valuation helps to determine the fair market value of your company. Many private companies will opt to hire an external expert to prepare and sign a detailed 409A valuation report prior to granting equity to employees, board members, consultants, and advisors.
An inaccurate or unreliable 409A valuation can potentially lead to some serious tax implications for both your company and its shareholders. Company leaders typically ensure they’re conducting a accurate and independent valuation from a trusted third party to move more confidently through the equity granting stage.
Collaboration and transparency are key parts of company-building.
Few founders can grow their company without support and guidance from others. Most relationships in a company's fundraising journey – advisors, investors, customers – are built on trust and transparency.
This can be especially true when assessing your relationship with your equity management software provider. Private companies deserve software tools that give them control over permissions and visibility into stakeholder activity. But software shouldn’t stop at features and functionality. Founders usually seek out software providers that offer support to help them navigate some of the complexities of the equity management process.
Why many private companies trust Fidelity Private Shares
Fidelity Private Shares is trusted by many companies. Here are a few major reasons why these growing companies put their trust in our equity management software:
We're engrained in the startup ecosystem.
Part of our mission is to provide more infrastructure for the private market. That’s more than just talk!
Our team is committed to growing a supportive network of founders, investors, and operators. The greater Fidelity Private Shares community can offer help with fundraising and due diligence prep, workshops to help with key aspects of fundraising, and networking events to help expand your reach.
We only use vetted third-party vendors for 409A valuations.
Our team understands that the stakes are high when it comes to 409A valuations. Determining your fair market value can’t be a role of the dice.
We work with third-party 409A Valuation Report providers and tailor our services based on your company’s individual needs. You’ll have complete access to your independent valuation expert, and our valuation reports have a high audit pass rate. Talk to our team to learn how to complete yours.
Our brand is synonymous with trust.
Fidelity has been a trusted name in the finance industry for many years. Founders can move confidently knowing that our equity management solution is backed by the reputability of the Fidelity brand.
Check out our recent G2 awards, including recognition for Best Support and Fastest Implementation for Winter 2024.
We’re built to support companies from incorporation to IPO
Fidelity is known for building best-in-class financial solutions to support companies at every stage. From incorporation to IPO, you’ll be able to access more of our product suite as your needs evolve.
Discover Fidelity Private Shares, your trusted provider of equity management solutions
Fidelity Private Shares is bringing more certainty to company ownership with our automated cap table and equity management platform.
If you’re seeking an alternative to your current equity management solution, our team will guide you through a smoother transition onto our platform so you can continue to confidently grow your business. Schedule a demo to learn more.
Fidelity does not provide legal or tax advice. The information herein is general in nature and should not be considered legal or tax advice. Consult an attorney or tax professional regarding your specific situation. Included are links to websites that are unaffiliated with Fidelity. Fidelity has not been involved in the preparation of the content supplied at the unaffiliated site and does not guarantee or assume any responsibility for its content. Fidelity Private Shares LLC provides cap table management and other administrative services to private companies and their equity compensation plans.
Fidelity Private Shares LLC
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