LTSE shutters cap table management business (formerly captable.io)
equity.ltse.com
equity.ltse.com
I honestly can't figure out how they are making enough money to stay in business. I have to assume that by getting a seat at the big boy RegNMS table, they are getting a share of the fees paid to the SIP. But even with that, seems like a tough way to get by.
It's a bit like being a newspaper opposed to publishing new news articles everyday. That can be a goal, I guess, but its a newspaper that isn't going to last long.
But LSTE has so little volume, that you frankly forget they exist most of the time.
As a customer I need to figure out whether I want to opt in, by January 31st at the latest.
Luckily, there is an Astrella demo webinar every week ! (And the next one is... on January 31st in the evening).
I would call this a short deadline.
It seems like there's a gap to be filled between the recent Carta issues and now this.
You never had shares “there.” You have shares. They recorded that fact.
Contrast this with buying Apple stock through Fidelity. Legally, Fidelity owns the stock [1]. (Well, technically probably not [2].) You properly own your stock “through” Fidelity.
Private cap tables are different. The cap table is what the investors and company say it is. To avoid mistakes and have an independent record for disputes, many companies opt to use a third party for administration. But the shares they track aren’t “there.” The cap table manager can go under with zero implication for the value or propriety of your shares. (Not necessarily true for Fidelity.)
As a practical matter, keep an eye out for an update from your company. As long as they have a proper notice address for you, you shouldn’t be subject to anything explosive.
That is to say, none of what you said is wrong but it’s not peculiar to private shares. Public shares are directly analogous.
Fidelity isn’t a great example as it’s likely too big to fail, but even if they did go under it would mean systematic collapse of the western equities markets. That said philosophically Fidelity failing _doesnt_ impact your legal claims precisely because Cede & DTC exist.
Most publicly-traded shares are held in street name. (Most but not all of those are with Cede & Co, but again, that's a technicality.) There is no common analog for street-name holding in the private markets. (Idiots keep trying to create it.)
> most founder shares are directly listed with a transfer agent (in the west probably at Computershare)
Yes, if you're a founder, "holding" shares on Carta is similar to "holding" shares that are publicly traded. I'm assuming someone asking this question isn't the founder.
> philosophically Fidelity failing _doesnt_ impact your legal claims precisely because Cede & DTC exist
There is no philosophy. Legally, if Fidelity fails, you have a claim on Fidelity and the SIPC. They have claims on Cede & Co. But in a very real sense, you "hold" your shares there.
Practically, Fidelity is unlikely to fail for a host of reasons. Maybe a less incendiary example is this: if Fidelity wants to freeze your shares, they can freeze your shares. They control them. If LTSE...E wants to freeze your shares, the company can overrule them. LTSEE isn't a "golden source." Put another way, Carta != EquityZen. (Though I think they also launched an SPV product?)
it's also noteworthy that their chairman/founder Eric Reis is now also cofounder of Answer.ai, so perhaps his personal focus is shifting a bit? idk, probably reading too much into a chairman's activities vs company focus.