Carta vs Shareworks vs Pulley: 409A Valuation Software
Your last valuation expired eleven months ago and the board wants to approve a grant next week. Waiting on a report while a new hire's start date slips is the ordinary reason companies rethink their provider, and it is the practical center of Carta vs Shareworks vs Pulley 409A. Turnaround, audit defense, and how much cap table cleanup the platform expects from you pull in different directions.
Vendors Covered in this Article
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For venture-backed growth companies (Series A through Series D) that want fast-turnaround 409A valuations with audit support, Carta is one of the most widely used options; ask any provider what audit support it includes. Carta executes thousands of valuations annually with dedicated valuation teams, delivering standard reports within five business days and providing full audit defense representation at no additional fee.
For enterprise technology corporations, late-stage pre-IPO unicorns, and complex multi-entity conglomerates requiring comprehensive equity compensation administration, Morgan Stanley Shareworks provides a strong institutional valuation and cap table solution. Shareworks pairs deep wealth management infrastructure and international tax compliance with institutional valuation rigor designed for public readiness.
For seed-stage, Series A and B2B SaaS startups that want a fast, cost-effective 409A valuation, Pulley is a platform worth evaluating; confirm current pricing and support with the vendor. Pulley delivers audit-ready valuations in three to five business days without the aggressive pricing tiers or customer service delays often experienced on legacy platforms.
For early-stage startups navigating their first few 409A cycles, Pulley is worth getting a quote from alongside Carta and Shareworks, since the right choice depends on your cap table and budget. For mid-market companies scaling toward private secondary rounds and institutional audits, Carta remains the default choice, while pre-IPO enterprises requiring global equity plan governance should choose Shareworks.
Side-by-Side Breakdown
Assessing 409A valuation providers requires finance leaders to look beyond base software subscriptions and evaluate valuation methodology, the audit support offered if the IRS questions the valuation, delivery speed, and cap table synchronization.
Carta includes 409A valuations in some of its subscription plans, so check the current plan details and any limits on how many valuations are included. When a company experiences a material event—such as raising a new equity round, signing a major customer contract, or reaching the twelve-month statutory expiration date—finance teams submit a request through the Carta portal. Carta's internal valuation team pulls live capitalization data, historical revenue numbers, and future forecasts, applying the Option Pricing Method (OPM), guideline public company methods, or discounted cash flow (DCF) models. Carta guarantees full Big Four audit defense: if an auditor questions a valuation, Carta's valuation directors defend the methodology directly with the auditor at zero extra cost.
Shareworks by Morgan Stanley approaches 409A valuations from an enterprise institutional perspective. As part of Morgan Stanley at Work, Shareworks manages complex equity plans for multinational corporations and late-stage private companies. Its valuations team handles intricate multi-class waterfall distributions, complex phantom stock units, profits interests, and international employee equity plans across dozens of foreign jurisdictions. Shareworks reports are engineered specifically to satisfy enterprise audit committees and public market regulatory disclosures, though software implementation and custom valuation modeling require longer lead times and higher investment.
Pulley has disrupted the valuation landscape by emphasizing speed, simplicity, and personalized support. Pulley says it bundles 409A valuations into some of its plans, so confirm which plan includes them and what the current pricing and turnaround terms are before you buy. Pulley assigns a dedicated valuation analyst to every account, allowing founders and CFOs to review initial draft strike prices, discuss market comparable selections, and adjust forward projections before reports are finalized. A valuation that follows the independent-appraisal standard in the Treasury regulations is presumed reasonable by the IRS, but no provider can guarantee that every auditor or the IRS will accept it, so ask about the provider's audit support terms.
Financial benchmarks illustrate the importance of accurate valuation planning. Scaling SaaS companies must balance aggressive growth with burn efficiency: median ARR growth drops from 60% for companies under $10M ARR to 25% for companies between $50M and $100M ARR1. At the same time, top-quartile companies maintain disciplined burn multiples between 0.8 and 1.42. A strike price set too high cuts the value of each option to employees, while one set too low can put the option outside the Section 409A exemption, which can mean extra tax for employees, reporting and withholding exposure for the company, and questions from your auditors. Securing a mathematically sound, audit-defensible valuation is essential for sustainable balance sheet governance.
Regulatory and tax note: Section 409A valuations have tax and accounting consequences, so work with your CPA or tax attorney on your specific facts. This content is for informational and educational evaluation purposes only and does not constitute formal legal, accounting, or tax advice. Consult certified public accountants and qualified corporate securities counsel before granting equity awards.
When to Choose Carta
Carta is often a fit for venture-backed B2B SaaS and technology companies (Series A through Series D) that want their cap table and 409A valuations in one platform that investors and auditors commonly already use.
What Carta provides with exceptional reliability is Big Four audit acceptance. When your company undergoes its annual financial audit or prepares for a major venture funding round, your auditors and investors' counsel will commonly ask to review your historical 409A reports. Because Carta performs tens of thousands of valuations each year, Big Four audit partners are intimately familiar with Carta's valuation templates, methodology assumptions, and volatility calculations. If questions arise, Carta's senior valuation team steps in to defend the valuation directly with the auditor until resolution.
Because your cap table, SAFEs, convertible notes, and option grants may already live in Carta, ordering a 409A there typically means little or no data re-entry, but confirm what the valuation team still needs from you.
Disqualifier: Do not pick Carta if your primary criteria are hands-on, personalized customer support and rapid custom iterations, as Carta's standardized valuation queue can feel impersonal and rigid when early-stage founders wish to discuss alternative market multiples or nuanced business models.
When to Choose Shareworks
Morgan Stanley Shareworks suits mature, late-stage private enterprises, pre-IPO unicorns, and complex multi-national corporations preparing for public market equity administration.
Shareworks focuses on institutional global equity governance. When an enterprise operates subsidiaries across North America, Europe, and Asia, issuing equity involves navigating disparate international tax codes, local securities laws, and complex currency translations. Shareworks excels in modeling complicated capitalization structures—including profits interests in LLCs, restricted stock units (RSUs), performance-based equity vesting, and multi-tier liquidation preferences.
Its seamless integration with Morgan Stanley's institutional wealth management services ensures that executive equity exercises, private secondary liquidity, and IPO transition workflows are executed with elite banking security.
Shareworks is generally built for larger companies, so if you're a seed-stage or Series A startup with a small team, confirm its onboarding timeline, complexity, and pricing before you commit.
When to Choose Pulley
Pulley is aimed at seed, Series A, and Series B software startups that want fast, transparent 409A valuations; ask how much direct access you get to valuation analysts.
Pulley focuses on speed, human touch, and transparent pricing. On legacy cap table platforms, founders frequently feel trapped in automated queues with anonymous support tickets. Pulley changes this by assigning a dedicated valuation lead who discusses your business model, reviews your historical financials, and shares draft valuation multiples before issuing the final report. This collaborative process ensures that unique business attributes—such as deferred revenue dynamics or temporary market headwinds—are accurately represented.
Pulley says draft 409A reports typically arrive in about three to five business days once it has your inputs, which can be faster than some providers, so confirm current timelines when you order.
Disqualifier: Avoid Pulley if your enterprise is an international public conglomerate requiring global equity plan administration across dozens of foreign legal entities or multi-currency wealth management brokerage, as Pulley is specifically optimized for scaling US venture-backed companies.
The Executive Recommendation
Select Carta if your company is a scaling venture-backed tech business that values the security of the industry's most recognized valuation provider, requires seamless cap table data integration, and wants guaranteed Big Four audit defense representation. Select Shareworks if you are a late-stage enterprise or pre-IPO unicorn requiring institutional global equity management, complex multi-entity waterfall modeling, and seamless connectivity to Morgan Stanley wealth services. Select Pulley if you are a high-growth startup or agile mid-market SaaS business that wants fast 3-to-5-day turnaround, transparent pricing, and responsive, personalized support from dedicated valuation specialists.
For the modern CFO, a defensible 409A valuation matters because it supports the IRS safe harbor presumption, which helps protect your employees from the additional taxes and penalties that apply to discounted options, though it isn't an absolute guarantee.
The category-wide limitation: 409A valuation software automates calculations and aggregates comparable company data, but software cannot fabricate economic value or alter real financial fundamentals. If an enterprise has missed its revenue targets, experienced accelerating cash burn, or raised a down-round with aggressive liquidation preferences, the valuation report must reflect those economic realities. World-class CFOs approach 409A compliance with financial transparency, realistic forward projections, and proactive board communication.
What Good Looks Like
An elite 409A valuation and equity management process functions with seamless governance rhythm. The finance team monitors the 12-month statutory valuation clock automatically, initiating a new valuation 45 days prior to expiration or immediately following any material financing event.
Cap table data, historical income statements, and three-year financial projections are reconciled directly within the platform. The valuation analyst applies appropriate market multiples, establishes defensible discounts for lack of marketability (typically 20% to 30% for private growth companies), and delivers an audit-ready report within five business days.
The board of directors reviews and formally approves the valuation via unanimous written consent during their next scheduled meeting. Option grants are issued precisely at or above the newly approved common stock fair market value, ensuring absolute IRS safe harbor compliance and insulating employees from tax risks.
Building The Capability
Establishing an audit-defensible 409A valuation capability requires finance leaders to advance through five structured operational stages:
- Learn: Master the statutory requirements of IRC Section 409A, Treasury Regulation 1.409A-1(b)(5)(iv)(B), and the criteria required to establish IRS 'safe harbor' presumption of reasonable valuation.
- Do Manually: Assemble all historical financing documents, term sheets, option grant ledgers, and audited financial statements into a centralized digital data room to understand all historical liquidation preferences and convertible debt terms.
- Delegate: Assign the Corporate Controller or VP of Finance responsibility for managing the annual 409A valuation cycle, maintaining cap table hygiene, and coordinating with external audit firms.
- Automate: Deploy an integrated cap table and valuation platform (Carta or Pulley) to maintain real-time capitalization records, initiate automated annual valuation workflows, and track option expiration dates.
- Buy: Partner with specialized venture tax attorneys and independent valuation appraisers to review complex capitalization waterfalls, model secondary transaction pricing impact, and defend valuations during financial audits.
How to Get Started
Execute an audit-ready 409A valuation across a disciplined four-week sprint:
Week 1: Prepare financial and capitalization inputs. Reconcile your cap table to ensure all SAFE conversions, option cancellations, and new hires are recorded. Finalize your 12-month trailing income statement and approved 12-to-36-month financial forecast.
Week 2: Select your platform and initiate the valuation request. Connect your cap table to Carta or Pulley. Submit your historical financials, industry categorization, competitor peers, and forward projections to the valuation team.
Week 3: Review initial draft report and methodology. Review the draft report with your dedicated valuation analyst. Validate comparable company selections, discount rates (DLOM), and weighted methodology models (OPM vs Guideline Public Company).
Week 4: Secure board approval and issue option grants. Finalize the 409A valuation report. Submit the report along with a unanimous written consent resolution to the board of directors for formal adoption. Issue pending employee option grants using the newly adopted common stock strike price.
What Good Looks Like
An elite finance organization maintains continuous IRS Section 409A safe harbor status, completes annual and event-driven valuations within seven business days of material triggers, and achieves 100% clean acceptance across all independent Big Four financial audits without strike price adjustments.
Building The Capability (5-Stage Skill Ladder)
How to Get Started
Disclosure: We may earn a commission if you buy through some links on this page. It doesn't change what we recommend.
Ensure accurate 1099 and year-end tax compliance alongside employee and contractor equity vesting schedules.
Streamline corporate spend management, venture banking, and automated audit trails for cap table expenses.
Automate corporate expense controls, accounting sync, and financial close documentation ahead of valuation audits.
Frequently Asked Questions
How long is an IRS Section 409A valuation valid for private companies?
A 409A valuation is generally presumed reasonable for up to 12 months from the valuation date. A material event, such as a new financing round, a secondary transaction, or a major acquisition, can make it unreliable sooner. You would typically get a new one before granting more options.
What happens if a private company grants stock options without a valid 409A valuation?
The employee can face income tax as the option vests, an additional 20% federal tax, and premium interest if the IRS treats the grant as underpriced. Some states add their own penalties. Incentive stock options that meet their own requirements follow different rules, so check with your tax advisor.
Can an early-stage startup use Pulley's 409A valuation during a Big Four audit?
Pulley says its 409A valuations are prepared to meet the IRS independent-appraisal standard, but no provider can guarantee acceptance by every auditor or by the IRS, so ask about audit support and review any report with your CPA.
Sources
Where we quote a benchmark, we show its source. Other figures in this guide are estimates or general guidance, so check them against your own numbers.
- ARR growth rate percentiles by ARR band (private B2B SaaS). SaaS Capital Research Brief 33: 2025 Benchmarking Private SaaS Company Growth Rates (14th annual survey, 1,000+ private B2B SaaS companies), 2024.
- Burn multiple guidance bands by ARR (net burn / net new ARR). a16z Growth burn multiple framework (Kahl & George, 'A Framework for Navigating Down Markets', May 2022), table transcribed by Kruze Consulting, 2022.
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