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Ditch Spreadsheets with Shareholder Technology Platform Astrella

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Deanna Ritchie


Looking for a scenario to justify ditching spreadsheets? How about this one?

  • Click.
  • Delete.
  • “We’re sorry, your data cannot be recovered.”

It’s the stuff of CEO nightmares: losing data due to a small slip of the finger on the mouse. Getting hacked and losing confidence in critical information about shareholders.

If you’re a CEO or tasked with funding a growing company, there’s no reason you should be manually updating information about equity. We’re in an era where we get our Amazon orders in a few hours and have endless information at our fingertips. Technology that supports automation is the next step in growing your business.

In addition, as more and more employees work from home, data privacy is more important than ever. As privacy needs grow, so do solutions. For example, you don’t need to trust a bulky spreadsheet with shareholder information about your company on a shared drive.

Finally, as entrepreneurs look to invest heavily—taking advantage of a down economy to build for the future—keeping perfect equity-related records is vital. This can be more complex than ever as founders look for creative ways to secure funding in a loud, crowded ecosystem.

Ditch spreadsheets. They’re on their way out. Software company Astrella has a better solution.

Replacing the Manual Cap Table

One of the most basic, important documents or data hubs for any startup or established business is its cap, or capitalization, table.

The cap table is essentially a list of all the shares and securities in the company. Stocks, warrants, convertible notes, and equity grants all show up here. In addition, rounds of funding, investor information, and more are stored within the table.

Stakeholders should be able to look at the cap table and understand how they would fare in a liquidation event. They should understand the impact of new rounds of funding, including the types of options offered. The table quickly and clearly shows how ownership of the company changes as more investors come on board.

5 Benefits of Using Software Designed for Cap Tables

You wouldn’t pull a sand wedge for a long drive. You wouldn’t don ski goggles for a deep sea dive. So also, you wouldn’t use a basic spreadsheet—something that looks like a cap table but isn’t designed for the same functionality—to track your company’s funding.

Here are a few of the specific benefits of ditching spreadsheets and using software that’s designed for optimal cap table functionality.

1. Scale as your company scales.

Astrella offers software that works for any size company, anywhere in the world.

Is your father your sole investor right now? If you plan to grow your company, you’ll need to be sure to track his share in the company as you raise more funds.

Do you have dozens of investors who each joined at different phases and under various promises? Naturally, you don’t want the liability of shoddy records when it comes time to pay dividends or go public.

In order to build a secure foundation for your growing business, you need a software solution that is smart enough to scale with your company.

Yes, Excel seems cheaper than a cap table, which might be until there is an issue. Not to mention that managing cap table software like Astrella is easier than hiring a lawyer to manage your firm’s equity.

2. Secure your data with blockchain technology.

The beauty of blockchain, the technology used to keep track of cryptocurrency, is that each transaction comes with an irreversible timestamp, which means no one can alter it surreptitiously.

This offers security to your investment information—no one can hack your system and edit ownership numbers. It also protects your data from errors from unknown sources.

In an era where technological advancements are outpacing security, using a secure software system—rather than a spreadsheet, even on a local drive—is like installing better locks on your home. It’s just brilliant.

3. Impress potential investors.

Your cap table doesn’t just matter to your current investors—it can be used as a tool to either attract or scare away potential investors.

A poorly kept cap table can reveal sloppy business ownership tactics that would make investors shy away. Clerking errors, incorrect formulas, and just plain, lousy formatting are all potential red flags.

In addition to bad record-keeping, a cap table can reveal various issues to a potential investor. Weaknesses such as having the wrong person own the wrong share in the company (like an investor who came on early for a tiny sum or an investment via a handshake deal that wasn’t recorded properly) become obvious when you look at your cap table.

You need a good cap table to identify your own areas that need solving, as well as shining for investors.

4. Administrate your stock with ease.

A good cap table is more than just a record of money-in.

A spreadsheet won’t cut it when you have complex payout and valuation models. However, Astrella has built all the management tools into its software—all you need to do is enter your ownership information.

In addition, software specifically designed for cap tables can help businesses stay in compliance with financial regulations. As a result, you can ditch spreadsheets and avoid many headaches down the road.

5. Project your company’s future.

Even the best software can’t actually predict the future, of course. But it can make projections, helping you, as the CEO, understand where you came from and where you’re going.

AI can provide forecasts and analytics that help business leaders make smart decisions about growth, fundraising, personnel, and more.

Moving Into the Future with Smart Cap Tables

A few trends, or at least opinions, in investing that make cap tables more critical than ever.

  • One is a push to democratize investing, making venture capital (VC) available to more startups without the pressure of the traditional growth-first VC mindset.
  • Another is VC investing in individuals rather than corporations.
  • Yet another is offering marketing partners such as influencers a stake in the company as part of their promotion deal.

Consider the last example: A small, dynamite shoe brand partners with an Instagram influencer who has a following of two million. That influencer negotiates a brand partnership where they own 1% of the company, in addition to a cash payout based on conversions. As a result, the shoe brand grew exponentially, and five years later, it went public.

Without a good cap table and an understanding of that influencer’s place in the company’s payout schedule, multiple legal and business problems could ensue.

Software like Astrella can make that situation as easy for a tiny startup as for a behemoth private equity firm. Ditching the spreadsheet has never made so much sense.

Image Credit: Lukas; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

Politics

Fintech Kennek raises $12.5M seed round to digitize lending

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Google eyed for $2 billion Anthropic deal after major Amazon play


London-based fintech startup Kennek has raised $12.5 million in seed funding to expand its lending operating system.

According to an Oct. 10 tech.eu report, the round was led by HV Capital and included participation from Dutch Founders Fund, AlbionVC, FFVC, Plug & Play Ventures, and Syndicate One. Kennek offers software-as-a-service tools to help non-bank lenders streamline their operations using open banking, open finance, and payments.

The platform aims to automate time-consuming manual tasks and consolidate fragmented data to simplify lending. Xavier De Pauw, founder of Kennek said:

“Until kennek, lenders had to devote countless hours to menial operational tasks and deal with jumbled and hard-coded data – which makes every other part of lending a headache. As former lenders ourselves, we lived and breathed these frustrations, and built kennek to make them a thing of the past.”

The company said the latest funding round was oversubscribed and closed quickly despite the challenging fundraising environment. The new capital will be used to expand Kennek’s engineering team and strengthen its market position in the UK while exploring expansion into other European markets. Barbod Namini, Partner at lead investor HV Capital, commented on the investment:

“Kennek has developed an ambitious and genuinely unique proposition which we think can be the foundation of the entire alternative lending space. […] It is a complicated market and a solution that brings together all information and stakeholders onto a single platform is highly compelling for both lenders & the ecosystem as a whole.”

The fintech lending space has grown rapidly in recent years, but many lenders still rely on legacy systems and manual processes that limit efficiency and scalability. Kennek aims to leverage open banking and data integration to provide lenders with a more streamlined, automated lending experience.

The seed funding will allow the London-based startup to continue developing its platform and expanding its team to meet demand from non-bank lenders looking to digitize operations. Kennek’s focus on the UK and Europe also comes amid rising adoption of open banking and open finance in the regions.

Featured Image Credit: Photo from Kennek.io; Thank you!

Radek Zielinski

Radek Zielinski is an experienced technology and financial journalist with a passion for cybersecurity and futurology.

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Politics

Fortune 500’s race for generative AI breakthroughs

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Deanna Ritchie


As excitement around generative AI grows, Fortune 500 companies, including Goldman Sachs, are carefully examining the possible applications of this technology. A recent survey of U.S. executives indicated that 60% believe generative AI will substantially impact their businesses in the long term. However, they anticipate a one to two-year timeframe before implementing their initial solutions. This optimism stems from the potential of generative AI to revolutionize various aspects of businesses, from enhancing customer experiences to optimizing internal processes. In the short term, companies will likely focus on pilot projects and experimentation, gradually integrating generative AI into their operations as they witness its positive influence on efficiency and profitability.

Goldman Sachs’ Cautious Approach to Implementing Generative AI

In a recent interview, Goldman Sachs CIO Marco Argenti revealed that the firm has not yet implemented any generative AI use cases. Instead, the company focuses on experimentation and setting high standards before adopting the technology. Argenti recognized the desire for outcomes in areas like developer and operational efficiency but emphasized ensuring precision before putting experimental AI use cases into production.

According to Argenti, striking the right balance between driving innovation and maintaining accuracy is crucial for successfully integrating generative AI within the firm. Goldman Sachs intends to continue exploring this emerging technology’s potential benefits and applications while diligently assessing risks to ensure it meets the company’s stringent quality standards.

One possible application for Goldman Sachs is in software development, where the company has observed a 20-40% productivity increase during its trials. The goal is for 1,000 developers to utilize generative AI tools by year’s end. However, Argenti emphasized that a well-defined expectation of return on investment is necessary before fully integrating generative AI into production.

To achieve this, the company plans to implement a systematic and strategic approach to adopting generative AI, ensuring that it complements and enhances the skills of its developers. Additionally, Goldman Sachs intends to evaluate the long-term impact of generative AI on their software development processes and the overall quality of the applications being developed.

Goldman Sachs’ approach to AI implementation goes beyond merely executing models. The firm has created a platform encompassing technical, legal, and compliance assessments to filter out improper content and keep track of all interactions. This comprehensive system ensures seamless integration of artificial intelligence in operations while adhering to regulatory standards and maintaining client confidentiality. Moreover, the platform continuously improves and adapts its algorithms, allowing Goldman Sachs to stay at the forefront of technology and offer its clients the most efficient and secure services.

Featured Image Credit: Photo by Google DeepMind; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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Politics

UK seizes web3 opportunity simplifying crypto regulations

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Deanna Ritchie


As Web3 companies increasingly consider leaving the United States due to regulatory ambiguity, the United Kingdom must simplify its cryptocurrency regulations to attract these businesses. The conservative think tank Policy Exchange recently released a report detailing ten suggestions for improving Web3 regulation in the country. Among the recommendations are reducing liability for token holders in decentralized autonomous organizations (DAOs) and encouraging the Financial Conduct Authority (FCA) to adopt alternative Know Your Customer (KYC) methodologies, such as digital identities and blockchain analytics tools. These suggestions aim to position the UK as a hub for Web3 innovation and attract blockchain-based businesses looking for a more conducive regulatory environment.

Streamlining Cryptocurrency Regulations for Innovation

To make it easier for emerging Web3 companies to navigate existing legal frameworks and contribute to the UK’s digital economy growth, the government must streamline cryptocurrency regulations and adopt forward-looking approaches. By making the regulatory landscape clear and straightforward, the UK can create an environment that fosters innovation, growth, and competitiveness in the global fintech industry.

The Policy Exchange report also recommends not weakening self-hosted wallets or treating proof-of-stake (PoS) services as financial services. This approach aims to protect the fundamental principles of decentralization and user autonomy while strongly emphasizing security and regulatory compliance. By doing so, the UK can nurture an environment that encourages innovation and the continued growth of blockchain technology.

Despite recent strict measures by UK authorities, such as His Majesty’s Treasury and the FCA, toward the digital assets sector, the proposed changes in the Policy Exchange report strive to make the UK a more attractive location for Web3 enterprises. By adopting these suggestions, the UK can demonstrate its commitment to fostering innovation in the rapidly evolving blockchain and cryptocurrency industries while ensuring a robust and transparent regulatory environment.

The ongoing uncertainty surrounding cryptocurrency regulations in various countries has prompted Web3 companies to explore alternative jurisdictions with more precise legal frameworks. As the United States grapples with regulatory ambiguity, the United Kingdom can position itself as a hub for Web3 innovation by simplifying and streamlining its cryptocurrency regulations.

Featured Image Credit: Photo by Jonathan Borba; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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