Managing cap tables and equity in high-growth companies can be a complex (and sometimes messy) business, a fact that founders and employees often find out too late. This has led to a wave of companies building software to help, and today one European leader in that pack is announcing some funding to boost its own development. Ledgy, a Zurich-based startup that builds capital management software specifically for companies and their multinational employees, has raised $22 million, a Series B that it will use to recruit, further product developments and bring in more users.
Lidgy’s platform today spans finance, HR, legal and VC teams, as well as their employees, and is used to both provide a simultaneous snapshot of a company’s equity status and help employees and companies manage their potential. Choose to do that over time. The company has about 2,000 companies as clients today, doubling its revenue from 1,500 a year ago.
Significantly, its rise heralds an exciting time for European technology. We are starting to see many more European startups choosing to stay in Europe and raise funding and scale rather than relocating to the US, and the issue of equity rewards for those companies. Employees are only growing. Ledgy counts some of the biggest startups in the European ecosystem, including Gethir, Cree, Mones, Selina Finance, Gorillaz, Choco, Alan, Penilla and Scalapay.
Ledgy has some impressive names on its own cap table. This round is led by New Enterprise Associates (NEA), with participation from Sequoia Capital, Speed Invest, btov, Visionaries Club and unnamed angels. Sequoia (as part of its big foray into Europe) led Ledgy’s $10 million Series A round a year ago, and in this latest round, NEA partner Jonathan Golden joins Sequoia’s Luciana Licandaru on the board. To date, it has raised $33.5 million.
Ledgi’s sweet spot is working with companies with employees located in different regions and building a product for them that serves as both a finance and HR tool.
Several companies such as Maps, and more recently Angelist and Pulley (respectively $6.8 billion, $4 billion, and up to $300 million for the smallest pulley) continues to make waves in the United States market, Ledgy has created an opportunity to build the conditions in which companies want to provide equity to international workers while balancing regulatory and cultural differences while doing so.
“We started in a fragmented Europe, which was both a curse and a blessing,” Sprigg said. It has forced us to serve clients with international teams.
Ledgy stumbled upon it by accident, Spirig said.
She and her co-founders (CTO Timo Horstschaffer and CPO Ben Brandt) were working on a different startup in Zurich in the security area — a “signal version of Slack,” Spirig’s catchy description said. They were chatting with another co-founder who showed them how to manage equity and the dashboard: it’s all on a spreadsheet.
“It was a big Excel file,” she recalls, “and each share took up one line.
Managing that was “an absolute nightmare,” she continued, but that wasn’t the only problem. not only It was the starting group from beyond Switzerland, but “Ya The team doesn’t really understand what equity is all about.
Surprisingly, there was no off-the-shelf product to address that three-pronged situation: equity management, tools for employees, that could be used in different countries.
“The way we handle this is different than historically when people managed on paper, then Excel, then software like Shareworks,” Spirig said. But in Europe, people didn’t understand the value of equity, so we wanted to make sure the employee experience was part of it. It’s a transition from being a financial-only product to not being people, either.”
That founder and the company are still Lidgy customers, Spirig said.
The company today is very focused on core equity and provides tools for companies and their employees to understand and manage it. This includes managing secondary transactions with third-party Semper. Offset tiles and images for benchmarks; and 40 other popular HR platforms used by companies to manage compensation and benefits. That also opens the door to functionality and features for Ledgy to build itself (or close with acquisitions) in the future.
“Through my lens as an investor, combined with past experience in category-defining companies like Airbnb, DraboBox and HubSpot, I see the role ownership plays in building sustainable companies,” Golden said in a statement at NEA. “The challenge of equity governance is particularly pronounced in Europe, where each country has different legal structures governing equity. Ledgy has created a smart and powerful equity software platform and built an incredible, best-in-class team to support it. Yoko, Ben and Timo understand the challenges companies face, and we are excited to partner with the Ledgy team as they continue to reinvent how companies think about equity and ownership.