Endowus-Carta Alliance to Boost ESOP Transparency and Liquidity for Employeesby Fintech News Singapore November 8, 2023
Singapore’s digital wealth management platform Endowus has deepened its partnership with Carta, a global equity management solution provider.
This partnership will help Endowus employees and other minority shareholders have greater transparency and liquidity of their holdings in startup equity directly on the Carta platform.
Endowus’ co-founders Samuel Rhee and Gregory Van had bootstrapped the business for the first four years. They then opened up the ownership of the company to its early joiners to achieve broad ownership by employees.
As a result, the majority of the company today is owned by a broad number of employees through direct investments into the cap table, or through the employee stock ownership programme.
The latest solutions Carta has rolled out allows for the look through of securities held through special purpose vehicles (SPVs). This allows for companies to establish SPVs for cap table management purposes whilst maintaining transparency on the beneficial interests held through such vehicles.
Endowus and Carta are now looking to provide more regular secondary transactions that provide liquidity and access—two major problems associated with owning stocks in private securities.
This will allow for increased transparency, flexibility, and liquidity options to Endowus’ Employee Stock Ownership Plan (ESOP).
“Our partnership with Carta represents a significant step forward in our commitment to empowerment and financial flexibility for the Endowus team. We understand that an employee’s growth journey with us will evolve and priorities in life will change.
With a thoughtfully designed, flexible, and transparent share ownership programme, we hope to empower our employees to understand how stock-linked compensation can impact their long-term wealth goals, while simultaneously nurturing a collective sense of responsibility and ownership in the company’s future,”
said Samuel Rhee, Co-founder & Chairman of Endowus.
“In Asia Pacific, we have historically seen fewer IPOs which has led to employees questioning the value of ESOP. In turn, this has made it more difficult for local startup founders to attract top talent.
Our work with Endowus is a significant step towards unlocking liquidity regionally and hopefully marks the start of a paradigm shift that can further benefit the local startup ecosystem. We commend Sam and the team at Endowus for leading by example and we’re thrilled to play our part in enabling this secondary transaction,”
added Bhavik Vashi, APAC MD at Carta.