In a strategic acquisition, the stock-trading platform Public has taken over the brokerage accounts from Carta’s secondaries business. Carta, widely known for its cap table management software, had expanded into the secondary market brokerage sector, a move that later sparked controversy.
Earlier this year, Carta faced serious allegations from a startup customer who claimed that the company had used private cap table data without consent to contact shareholders and facilitate a sale. This accusation stirred significant unrest among Carta’s clientele, with many customers threatening to leave the platform. In response to the mounting pressure, Carta decided to close down its secondaries business.
However, Carta’s exit from this sector was not without a plan. The company found a buyer in Public, which has now acquired Carta’s secondaries division. Public has assured that customers transitioning from Carta Capital Markets can opt out of their services if they choose.
Despite stepping back from direct secondary market brokerage, Carta is not entirely withdrawing from the space. The company intends to continue its involvement in the secondary market through “company-led secondary offerings, such as tender offers,” facilitated by its SEC-registered transfer agent.
This acquisition signals a significant shift in the secondary brokerage market, as both Carta and Public navigate the aftermath of recent controversies and redefine their roles within the industry.
