In an attempt to do damage control, the CEO of the capital management startup letterHenry Ward today sent an email to his clients telling them that if they are concerned about the “negative press” related to the outfit, they should read a post of his on Medium.
The move only seemed to draw more attention to the many reported problems plaguing the 11-year-old company.
Ironically, some of the customers say they hadn’t even seen the negative press until Ward called attention to it, according to publications on the social platform X.
One X user wrote: “Cringe. They forget that it’s not a big deal unless you make it a big deal.” Other wrote: “This is literally the first time I’ve heard about Carta’s negative press, but I’m definitely not going to ‘ignore’ it now, ha.” Still, another user aware: “I feel like this is a terrible communications job, don’t draw unnecessary attention to the majority of people who probably never saw anything anyway, if it doesn’t affect me directly I probably don’t care.”
Says one of the many investors in Carta, who was recently assigned a post-money valuation of 7.4 billion dollars in 2021, when it last raised an institutional funding round: “That’s strange,” of Ward’s decision to reach out to clients about some of the negative coverage that has swirled around the company, including, more recently, in an article published on October 24. by Well-informed personand 4th of October and October 16 pieces published by Fortuna. “90% of your clients don’t really think about you every day,” said the VC, who asked not to be identified. “This might have been a kind of founder’s look, like, ‘Everyone must be thinking about me all the time,’ but most customers of any product, including Carta, have their own work to do. “If your product offers value, they won’t think too much about it.”
In it Medium postwhich Ward posted five days ago, describes conversations he has had with Carta employees about a long series of negative press, including, most recently, lawsuits surrounding sexual abuse allegations by executives, a toxic “boys club culture”“, and indecent exposure, among other things.
In his post, Ward suggests it is the goal of ambitious journalists hell-bent on building their careers by exposing companies for their “bad behavior.” The position is a public service, in a sense, Ward writes. ““I know other CEOs have to deal with this, so I wanted to share what I shared with employees in case it is helpful to other CEOs looking at similar issues.”
It continues to delve into the numerous allegations about the company, while seemingly confirming them. He says, for example, that Carta has “extensive documentation” that former chief technology officer Jerry Talton “was inappropriate with women and abused his position.” Ward adds: “It also turns out that after he left, we discovered that He is misogynistic and racist.” Ward also reports that she has extensive documentation that (former chief product officer) Heidi Johnson “was a bully, had the lowest approval rating of managers, and misused corporate finances for personal use.”
He adds in the publication: “We fired them both. That’s where the press is wrong. Our mistake was not firing them. Our mistake was hiring them.“
This year started on a difficult note for the company, whose main business is selling software to investors to track their portfolio and which has raised more than $1 billion from investors including Spark Capital, Andreessen Horowitz, and Union Square Ventures. In January, TechCrunch reported that Carta was suing his former CTO, Jerry Talton. The company said Talton was fired “for cause” on Dec. 23.
In its lawsuitCarta said it was suing Talton for damages, citing “his unlawful and illegal acts as an executive of Carta” and suggesting that he betrayed the company even though he was assigned a position that carried “hundreds of thousands of dollars in salaries.” and benefits, and substantial benefits.” equity awards.”
It was not the first case in which Carta was involved in a lawsuit. In 2020, the company’s former vice president of marketing defendant Letter, accusing the company of gender discrimination, retaliation, wrongful termination and violating the California Equal Pay Act. (We present that case here.) Shortly after, four employees spoke on the record with The New York Times and told the outlet that when they raised concerns about the way the company is run, they were marginalized, demoted or subject to pay cuts.
The company has also been accused of poor customer service. TechCrunch this year interviewed numerous Carta customers who expressed dissatisfaction with the company and its representatives. One of them, a fund manager who is currently in the midst of transitioning off the platform, told TC EIC Connie Loizos that his team had “four different account managers in less than two years of participating in Carta ; It certainly didn’t help with continuity and understanding of our fund and our needs.”
Another fund manager TC interviewed complained of a “lack of internal communication,” saying it is “like working with four service providers.” Letter “will ask you for a document that you have on file and you should know that you have on file,” he said. “I shouldn’t have to keep score; That’s why I pay for the administration of the fund. “They will tell you to check ‘the portal’ and the portal is terrible.”
Things became more tumultuous for the company as the year progressed.
In August, Alexandra Rogers, a former sales manager, filed a lawsuit against Carta after alleging that Ward retaliated against her after she filed harassment complaints against Carta’s revenue officer, Jeff Perry, according to a report from Fortune.
Earlier this week, Insider reported that court documents, complaints filed with the EEOC and the California Department of Civil Rights, and interviews with more than a dozen current and former employees paint a picture of “a company plagued by harassment and discrimination, a fast and flexible approach for compliance, and a culture of absolute loyalty to an erratic and vindictive CEO.”
TechCrunch reached out to Carta for comment and had not received a response at the time of publication.
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