Best employee stock options tracking software | LTSE Equity

What is employee stock options tracking software?

Employee stock options tracking software is a central platform designed to streamline and automate the management of stock options offered to employees within a startup. It helps startups track, manage, and administer stock options, providing real-time information and ensuring accuracy and compliance. This software simplifies the complex process of granting, exercising, and tracking stock options, making it a crucial tool for startups of all sizes.

Initially, stock options management was a manual and time-consuming task, prone to errors and inefficiencies. However, with this software, startups can now automate and digitize this process, reducing errors and increasing transparency for employers and employees. These software solutions offer unique features, such as option grant tracking, vesting schedules, exercise and expiration tracking, and comprehensive reporting capabilities.

Employee stock options tracking software offers essential features to streamline the management process. When choosing an employee stock options management software, look for features like a user-friendly dashboard, secure data storage, backup and recovery, comprehensive reporting capabilities, compliance with legal and accounting standards, employee self-service access, scalability for growing startups, and professional support and assistance. 

These ensure efficient and accurate management of stock options, improved transparency, and simplified compliance processes.

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When do startups need employee stock options tracking software?

Startups require employee stock options tracking software at various stages of their growth. However, during the early stages of founding to the Series A and Series B funding rounds, it becomes especially crucial for managing the complexities of stock options issuance, vesting, and monitoring.  It automates processes, ensures compliance, enhances transparency, and provides scalability as the startup grows. 

Startups, especially those in the early stages of development, have plenty to benefit from using this software. It helps them efficiently manage and track the stock options they offer to their employees.  Let's now explore how it applies to different stages of a startup's growth.

Early-stage startups benefit from employee stock options management software as it streamlines and automates the complex process of managing stock options. From the moment a startup is founded, it is essential to have a clear framework for allocating stock options to early employees, co-founders, and advisors. 

Employee stock options tracking software helps startups efficiently manage the issuance and vesting of stock options, ensuring proper documentation, and reducing potential disputes or legal complications. It also accommodates the growing needs of startups as they expand their workforce and attract investors.

As a startup progresses to its Series A funding round, it grows significantly in the number of employees and equity grants. An employee stock options tracking software becomes essential to handle the increased complexity of stock options management. It helps startups maintain accurate records of stock options grants, vesting schedules, and exercise activity, providing transparency to investors and compliance with equity-related regulations.

By the time a startup reaches its Series B funding round, it may have significantly expanded its operations and workforce. Employee stock options tracking software becomes even more necessary at this stage, as the number of stock options grants and vested options increases. The software helps startups efficiently manage a large volume of stock options, generate comprehensive reports for audits or financial reporting, and provide employees with easy access to their stock options information.

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Why do startups need employee stock options tracking software?

Startups need employee stock options tracking for various reasons that include:

1. Efficiency and accuracy: Employee stock options tracking software automates repetitive tasks, such as options grant issuance, vesting tracking, and exercise management. This reduces manual errors and the complexities of stock options management, allowing startups to focus on growing their business instead of time-consuming paperwork.
2. Compliance and reporting: Startups are subject to various regulatory requirements concerning stock options. Employee stock options tracking software helps maintain compliance by generating accurate reports and ensuring adherence to legal and accounting standards. It also simplifies the process of providing necessary documentation during audits or due diligence.
3. Transparency and communication: Stock options are a vital component of startup compensation packages, and employees value transparency regarding their equity ownership. Employee stock options tracking software enables startups to provide employees with self-service access to their stock options information, including vesting schedules and exercise opportunities.
4. Investor confidence: Startups often rely on external funding to fuel their growth. Utilizing employee stock options tracking software ensures that startups can present a well-organized equity management system to potential investors, which shows professionalism, transparency, and the ability to manage equity-related matters.
5. Scalability: As startups grow, managing stock options manually becomes increasingly challenging. Employee stock options tracking software scales with the startup, accommodating more stock options grants, vesting schedules, and exercise activity. It provides the infrastructure to handle the complex nature of equity management as the startup expands its workforce and attracts more investors.

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Things to consider when choosing employee stock options tracking software

Issuing employee stock options is a sure way to retain and attract employees. However, due to the impact of stock options on your startup's ownership structure, it is crucial to track them meticulously. This is where stock options tracking software comes into play. With numerous options available in the market, consider the following factors to choose the right solution for you:

Is it easy to use? 

Your choice of stock options tracking software could offer vast functionalities, but if it has too steep of a learning curve, you might want to consider alternatives. Opt for an accessible solution with a user-friendly interface to minimize the learning curve. This will allow you to focus on other areas such as networking and fundraising.

Will it scale with your startup’s growth?

Your startup's ownership structure is far from static. As you progress from seed to series and onboard new employees, things will change – from introducing option pools to issuing equity-based compensation – and your software should be able to account for this.

Will there be support for you when you encounter issues?

Encountering problems with your software is, unfortunately, common. Not being able to resolve them through good customer support is not. Opt for employee stock options tracking software that offers dependable customer support, whether through comprehensive knowledge bases or responsive customer service.

Is it appropriate for your budget? 

Price ranges vary widely between different solutions and expensive doesn’t always mean better. Before committing to a solution, carefully consider its pricing in relation to the value it brings to your startup.

Will it address your reporting and compliance needs?

A good stock options tracking software should assist startups in maintaining compliance with relevant regulations. Keep an eye out for features like annual cap table health checkups and alert systems for report submissions.

Does it come with scenario modeling?

Effective decision-making during fundraising and exit negotiations requires the ability to visualize how convertible notes and SAFEs convert. Look for stock options tracking software that provides scenario modeling capabilities to assist you with this.

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Top employee stock options tracking software

With so many different employee stock options tracking software options available, deciding on which to go for can be a little tricky for startups. Here are some of the most widely used by startups:

Carta is one of the most well-known names in the field and it shouldn't be surprising that they're also used by a large number of startups, thanks to their large range of features.

Highlights

• Vast capabilities: Carta's list of features and functions cater to just about any sized startup and will easily assist with employee stock options tracking and beyond.
• Simple user interface (UI): Carta’s UI is intuitive, visually appealing, and extremely customizable, enabling users to easily access the information they need and perform necessary tasks.
• Knowledge support: Not only does Carta provide in-depth knowledge bases, but they also provide educational resources on industry-relevant topics through blog posts, webinars, industry reports, and more.

Limitations

• Prohibitive pricing: Carta's pricing can be perceived as unaffordable for smaller startups with limited resources. Additionally, their pricing may lack full transparency, including sudden price changes.
• In-house 409As: Carta conducts 409A valuations internally instead of utilizing a third-party appraiser such as Groots Valuation.
• Excessive functionalities: For most early-stage startups, Carta's extensive range of functionalities may be unnecessary for just employee stock options tracking.

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A relative newcomer to the scene, especially when compared to more established names like LTSE Equity and Carta, Pulley offers a fresh yet highly functional and straightforward solution for their customers.

Highlights

• Simple UI: Pulley provides users with a clean and user-friendly interface, enabling users to get started with employee stock options tracking from day one.
• Emphasis on startups: Pulley was created with the primary aim of supporting startups. From relevant educational resources to helpful support, startups will be supported on their journey.
• Good customer service: Pulley has a responsive customer service team that is equipped to address concerns and resolve issues.

Limitations

• Lack of cap table checkups: Pulley does not offer cap table health checkups, unlike alternatives like LTSE Equity.
• Restricted modeling options: Modeling options are limited compared to waterfall modeling which is only available via their custom plan offering.
• Lengthy onboarding: Onboarding may take up to 10 days, which is slower compared to their market competitors.

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Eqvista takes advance of its deep valuation experience to engineer a cloud-based solution that combines functionality with useability.

Highlights

• Extensive valuation experience: Eqvista is highly experienced in conducting valuations, from 409As to company valuations.
• Simple UI: Eqvista offers a straightforward and intuitive user interface, ensuring easy navigation and quick access to essential information.
• Advanced features: Eqvista is capable of advanced features, such as automated data import and compilation streamlining tasks, and minimizing manual work.

Limitations

• Missing important functions: The base plan of Eqvista lacks key features such as financing round modeling and 409A valuations. Startups need to upgrade to premium to access these functionalities, and by extension spend more.
• In-house 409As: Eqvista performs 409A valuations internally instead of through an independent valuator.
• Unsuitable for early-stage startups: Eqvista's reporting and valuation features are more aligned with companies in later stages of growth, which may not cater to the specific needs of beginners or early-stage startups.

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AngelList is no newcomer for those in the know. That said, they absolutely are when considering employee stock options tracking software having only entered the market in 2021.

Highlights

• Combined offering: AngelList's stack solution unites equity and cap table management, banking, and advisor equity grants, providing a comprehensive service.
• Startup recruitment: AngelList serves as a powerful platform for startup recruitment, offering a compelling alternative to LinkedIn by connecting talent and investors with opportunities.
• Networking: AngelList links entrepreneurs with investors and venture capitalists, fostering valuable connections.

Limitations

• Limited cap table functions: Although AngelList offers various features related to fundraising and investor networking, cap table management is not the primary emphasis.
• Expensive: AngelList's pricing structure is based on the number of stakeholders, including employees with shares, which can make it expensive for larger teams.
• No cap table health checkups: Ensuring your cap tables are healthy is imperative for good employee stock options tracking. Unfortunately, AngelList does not offer this.

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Shakreworks offers a novel stock options tracking software that helps startups keep track of their ownership structure, attract and retain the best, and manage their equity. 

Highlights

• Mobile access: Shareworks offers a mobile version that enables employees to quickly access their stock options without the need for a desktop or laptop.
• Comprehensive dashboard: Shareworks' dashboard offers a comprehensive display of critical information, allowing users to easily grasp key insights, such as the value of their options.
• Specialized guidance: Shareworks offers tailored services from a group of specialists who provide full support for startups for all matters, from employees to equity.

Limitations

• In-house 409As: Shareworks conducts 409A valuations internally instead of through an independent valuator.
• Slow interface: Shareworks has received feedback and complaints regarding the slow speed of its interface, raising concerns among users.
• Poor customer support: Many reviews have expressed dissatisfaction with Shareworks' customer support, citing difficulties in issue resolution and extended response times.

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“By founders and for founders” is the ethos LTSE Equity wholly subscribes to. Their transparently priced and affordable solution aims to help mission-driven startups achieve their milestones at every step of the way.

Highlights

• Scalability: LTSE Equity offers both basic employee stock options tracking functionalities and advanced features like scenario modeling and cap table health checkups, making it suitable for startups at all stages of growth.
• Affordability: LTSE Equity provides transparent and affordable pricing options with three founder-friendly plans that can satisfy any startup.
• Freedom of choice: LTSE Equity distinguishes itself by offering startups the ability to select from a range of reputable 409A providers, setting it apart from most platforms.

Limitations

• Lack of LLC support: Currently, LTSE Equity does not have built-in support for LLCs, although it may be possible to work around this limitation with the right steps.
• Simple UI: LTSE Equity's UI is built for functionality first and may lack some look and feel features offered by other competitors like Carta.
• No Rule 701 management: While LTSE Equity can support Rule 701 analysis, it does not provide specific capabilities for Rule 701 management.

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Top reasons founders choose LTSE Equity

Picking the right software to track your employees' stock options is tough given the vast range of options to pick from. However, in a sea of similar-looking software, LTSE Equity has been the go-to for over 30,000 startups. This is why this is the case:

• Easy-to-use platform: With a focus on delivering a seamless experience, our powerful features are complemented by an intuitive interface. This allows users to spend more time tracking employee stock options instead of elsewhere. 
• Scalability: No matter the size or stage of your startup, LTSE Equity is designed to scale alongside your growth. From conducting 409A valuations to ensuring Form 3921 readiness, modeling various scenarios, and tracking employee stock options, our solution adapts to meet your evolving needs.
• Exceptional customer support: At LTSE Equity, we pride ourselves on providing unrivaled customer support. This is made possible thanks to our highly trained team of consultants that can address any question or issue that may arise at any time.

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LTSE Equity FAQs

What makes LTSE Equity different from other platforms?

LTSE Equity is created by founders, for founders. Our full suite of equity management features reflects our real-life experience and insights, empowering your startup to prosper and endure.

How much does LTSE Equity cost?

Our pricing is strictly founder-friendly and scales as you grow. Our plans are also completely transparent, with no hidden costs or surprise price hikes.

Does LTSE Equity provide a free trial or demo?

Yes! Dive into our full-featured demo now and discover every benefit LTSE Equity has to offer—no sign-ups required.

How can I switch to LTSE Equity?

Simply send us your current spreadsheet or cap table, and we’ll get your details onboarded within a week.

How can I ask more questions about LTSE Equity?

Not sure which plan to choose? Looking for a live demo? Schedule a call with our team now.