AngelList Returns to its founder-Focused roots, with a Twist

AngelList Stack, a new suite of tools that will compete with Carta in delivering services to assist entrepreneurs start, operate, and maintain ownership of their businesses, was unveiled this week. End-to-end incorporation, business banking, adviser equity grants, and cap table management will all be covered by the new software. Avlok Kohli, CEO of AngelList, remarked, “Every time you actually go to create a company, you start out with this optimism.” “You have this brilliant idea, you’re full of self-assurance, and you want to go execute it, but then there’s all this mundane stuff to work out.”

The goal of AngelList Stack, according to Kohli, who was a repeat founder before joining AngelList, is to simplify some of the more boring and arcane aspects of launching a business. The end-to-end incorporation service will assist founders with all aspects of the paperwork required to launch a business, from deciding which state to incorporate in to determining what type of business classification to pursue. It will also assist founders in tracking and filing 83(b) filings, a specialized but crucial document for individuals with stock that may result in millions of dollars in back taxes if done incorrectly.

Kohli hopes that by simplifying the user experience for founders, AngelList can be more than just a lawyer consultation when it comes to officially creating a company.

“Lawyers typically consider incorporation as a cost-cutting measure to establish a relationship with the founder and work with them in the future, or just to make the paperwork easier,” Kohli added. “But then they come to a complete stop right there.” Alternatively, AngelList wants to introduce founders to its next tool: financial services.

The financial instrument consists of two parts: interest-bearing deposit accounts and debit cards. Both accounts make it easier for entrepreneurs to accept wire transactions from investors automatically, which can subsequently be integrated into AngelList’s new cap table feature. Issuing digital shares, SAFEs, reporting, 409As, and employee option grants will all be part of the cap tool. The business claimed in a statement that “founders can raise their first SAFE round entirely on Stack by giving a link to investors to digitally sign the SAFE.” 

Carta, formerly known as eShares, has echoes in AngelList Stack. While AngelList focused on angels and venture capitalists when it first began, Carta focused on employees and founders. Carta and AngelList both pursued size over time, with Carta acquiring cap table land and AngelList acquiring syndicates and fund operations. Both firms’ visions to be an end-to-end stack for venture and startups are overlapping as they grow. AngelList, on the other hand, is a far smaller company than Carta, having raised only $26.2 million to date, according to Crunchbase.