3 Reasons Why Your Startup Needs a Cap Table Management Software

3 Reasons Why Your Startup Needs a Cap Table Management Software
3 Reasons Why Your Startup Needs a Cap Table Management Software

It’s been some time since startups started using cap tables for managing several stock options, issued certificates and different entities associated with the same.

All of this information is certainly crucial to the companies maintaining cap tables. But, are they doing it right? Or to word it better, are they able to procure for themselves an easy flow of their cap table management processes?

A number of cap table management tools and software are available for easing the cap table processes. In this post, we will talk about why your startup needs one. Read on to know more.

1. Empowers Your Organization To Manage Funds From Investors Better

One of the main reasons why using a Captable Management Platform such as Vertalo is a good idea for your firm is that it’ll enable you to easily manage funds from investors.

As your company grows or/and plans to grow, it may require and acquire funds from various investors. All these investors will have a stake in your company and all this data will have to be managed. This kind of management when done on a spreadsheet may have a number of human errors.

Result? The representation of how your company’s stocks are spread may not be as comprehensive as it should be, causing problems and confusion.

Also, this kind of subtle management will help you negotiate better with the fundraisers as every important piece of information will be right in front of your eyes.

2. Helps In Employee Hiring and Retention

Hiring talented employees and keeping them with your organization is one important and often mismanaged task.

With a sea of candidates to choose from, finding the right talent often becomes difficult. And then once you have found them, it becomes important to keep them from leaving too.

In situations like these, offering some stocks from your company can really help. It’s one great incentive that most employees love to receive and appreciate. But, apart from providing them these stocks, your team will also have to take care of adding up or updating these entities in the cap table.

A cap table management software will make life easier for your team. Also, using such software will bring in transparency allowing employees, executives, and investors to easily view their holdings.

This is one simple way of keeping valuable talent close and motivated.

3. A Cap Table Management Software Will Help You Be Compliant

Keeping up with all the taxing rules and regulations can be a serious challenge for your startup.

And then, if you’ll be using a spreadsheet cap table without a management software, you may have to spend hours figuring out what to add in which part of the tax forms.

While, if you’ll use a cap table management software, it’ll enable you to comply with these processes easily by notifying you with all the essential updates. Also, it will help you fill the forms and you won’t have to keep worrying about any mistakes at all.

Sounds good, right? Certainly, employing a cap table management software is a good idea for easing your cap table management chores.

Final words

As your startup tries to make the most out of its cap table management processes, several errors can pull the growth down. Employing a cap table management software is a sure shot solution to this problem. CTM software allows startups to improve their issuer, broker and investor connections in an economic way.

This is an article provided by our partners network. It does not reflect the views or opinions of our editorial team and management.

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