Carta is Alleged for Following Unethical Tactics by a Famous Startup Company
Carta, one of the most prominent cap table management software provider companies, has recently faced an allegation from Linear, a project management software company. The situation caught the heat last Friday, and many questions have been raised about its functional capability and operational approach. Carta has been benefiting the company for 14 years and is currently valued at $7.4 billion. However, the recent working directions have put this company in serious trouble in the recent as well as many previous acquisitions.
Basis of Allegations
Linear is one of the most promising project management software companies, that was launched four years ago and generated straight $35 million in funding. Karri Saarinen, who is the current CEO of Linear, came to the party last Friday, January 5, 2024, and accused Carta of unethical tactics to boost their personal growth and disrupt the popularity of startups. Linear is also the customer of Carta for their cap management.
Saarinen, in his statement, has revealed that one of the Carta’s representatives reached an angel investor of Linear on Friday. The representative has told the individual that Carta is currently holding the firm buy order from a rich company for specific prices. Further, the Carta employee mentioned in the email that the buyer might flex higher than expected. Linear’s CEO has further commented that it was all out of his consent and knowledge.
Linear’s CEO
While Carta has taken a seriously unethical step, Linear’s CEO Karri Saarinen has decided not to hold back on this situation. He revealed that the company is facing no issues with its current shareholders. Additionally, the angel investor is very close to the CEO, and he immediately let him know about the situation. Saarinen readily went to LinkedIn and X (formerly Twitter) to share his thoughts and anger on Carta’s move as he felt immensely betrayed.
In his writing, he clearly stated that Carta has taken a shit move which will immediately end their reputation as the most trusted cap management platform for upcoming and small startups. Moreover, he showed his frustration and continuously targeted the unethical tactic of Carta to compel angel investors to sell their Linear shares to unknown buyers.
Saarinen also claimed that Carta has never approached him regarding the debate over shares. In his publishing, he revealed that the investor whom Carta contacted was their family member. Therefore, they readily got the awareness of the incident. Otherwise, there could be serious troubles for the company.
In his tweet on X, Saarinen stated that he had been told by numerous companies that all such stuff was going on for several months. Carta has contacted many of their customer companies’ employees to put their shares on sale.
Future Implications
With such enormous announcements and allegations of Linear, Carta will certainly face serious consequences. It may result in the form of reduced audience base. Also, the chances of court lawsuits are high, which can be more troublesome.
