A 409A valuation is an independent appraisal of a private company’s common stock to determine its fair market value, most often used when granting stock options to employees.

This process is a legal protection for startups under IRS Section 409A. Without a defensible 409A valuation, companies risk severe tax penalties for the business and its employees, along with potential IRS challenges that can disrupt growth.

Compliance isn’t optional for founders, CFOs, and finance teams handling equity compensation; it protects the company and maintains employee trust. The right 409A valuation also provides Safe Harbor protection.

However, not all valuation providers deliver the same level of reliability or efficiency. This guide discusses the best 409A valuation providers for startups and how to choose the right one for your business.

What is a 409A Valuation? (And Why Startups Need It)

A 409A valuation is an independent appraisal of a private company’s common stock to determine its fair market value (FMV). It derives its name from Section 409A of the Internal Revenue Code, a regulation introduced after the Enron scandal to curb abusive deferred compensation practices.

A 409A valuation is a legal requirement that startups must meet before granting stock options or other equity-based compensation to employees.

When Do Startups Need a 409A Valuation?

The IRS requires companies to update their 409A valuation at least once every 12 months or sooner if a “material event” occurs. Common triggers include:

• Equity grants: Issuing stock options or RSUs.
• Fundraising: Closing a new round of financing.
• Corporate milestones: Mergers, acquisitions, or secondary sales.
• Liquidity events: Preparing for IPO or exit.

Failing to obtain a defensible 409A valuation exposes startups to:

• IRS penalties: Employees may face immediate income recognition plus a 20% penalty tax on top of regular income tax.
• Unhappy employees: Inflated option strike prices can erode the perceived value of compensation packages, making it harder to attract and retain talent.
• Audit exposure: Weak or DIY valuations are easily challenged in IRS or SEC audits, leading to compliance headaches.

Factors to Consider When Choosing the Best 409A Valuation Provider

Here are the most important factors to evaluate when shopping for the best 409A valuation provider:

Turnaround Time

Early-stage startups often need valuations quickly, especially when closing a funding round or issuing new stock options.

Standard turnaround times usually range from 5 to 10 business days, while expedited services (48 to 72 hours) are available at a premium. Confirm a provider’s ability to meet urgent deadlines without compromising accuracy.

Audit-Readiness

Look for firms that use well-established methodologies such as the Option Pricing Model (OPM), Probability-Weighted Expected Return Method (PWERM), and Current Value Method (CVM).

The provider you choose must be able to defend valuations before the IRS or Department of Labor.

Cost

Pricing varies by stage and complexity. Seed and pre-seed startups may pay $1,000 to $3,000, Series A-C companies usually pay $3,000 to $8,000, and later-stage or pre-IPO startups can expect $8,000 to $20,000+.

Always balance affordability with defensibility; going with the cheapest option can cost far more in penalties later.

Customization vs. Standardization

Some providers deliver templated reports suitable for early-stage companies, while others offer bespoke, highly detailed valuations for complex cap tables and multiple share classes. The right fit depends on your company’s growth stage and financing activity.

Technology and Tools

Modern 409A providers often integrate directly with cap table management platforms, thus allowing for seamless updates and equity planning. Look for dashboards, scenario modeling, and automated compliance reminders that reduce administrative burden.

Customer Support

The best providers offer direct access to analysts, ongoing Q&A, and investor/audit support when questions arise. Having experts available ensures your valuation is easily defensible when challenged.

Best 409A Valuation Providers for Startups in 2025

#1 Carta

Carta remains firmly established as one of the top-tier 409A valuation providers for startups, trusted to execute over 16,000 valuations annually, far more than any other provider.

Embedded within its broader equity management platform, Carta offers seamless access to cap table insights alongside valuation services.

Ideal Use Case

Carta is an excellent fit for early-stage to mid-market startups seeking audit-ready valuations integrated directly into their equity workflows. It serves companies that value speed, defensibility, and the convenience of an all-in-one platform.

Turnaround

For early-stage startups (typically Series A and below), Carta can deliver a draft 409A valuation within 1 to 3 business days after receiving all required data, thus reducing administrative issues.

Audit-Readiness

Carta’s valuations are fully IRS safe-harbor compliant, prepared by experienced, independent analysts, and regularly validated during audits, including those conducted by Big Four accounting firms. A dedicated valuation team is available to support clients through audit queries.

Pros

• Cap table and valuation in one platform, with quick delivery.
• Safe harbor qualified, backed by audit experience.
• Analysts are available for follow-up, guiding you through audit preparation.

Cons

• Requires Carta onboarding; no standalone valuation available.
• Service bundled within paid plans; not the most affordable for ultra-early-stage startups.

#2 Pulley

Pulley positions itself as a founder-first equity management platform built to simplify complex cap table, fundraising, and compliance workflows, especially for startups.

Trusted by thousands of companies from seed to scale, Pulley offers tools that go beyond traditional equity software, including scenario modeling and seamless 409A valuation processes.

Ideal Use Case

Pulley is suitable for early- to mid-stage startups that need agility and accuracy. It’s well-suited for teams looking for rapid and audit-defensible 409A valuations without sacrificing usability. Its intuitive interface, transparent pricing, and direct support make it a go-to for founder-led finance teams.

Turnaround Time

One of Pulley’s unique features is its speed. Valuations are usually completed in just 2 to 3 business days, significantly faster than many traditional firms that require weeks.

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Audit-Readiness

Pulley’s 409A valuations are designed to be fully audit-defensible. Reports adhere to IRS, AICPA, and SEC standards and come with free lifetime audit review support, which boosts confidence in IRS or investor scrutiny scenarios.

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U.S. employers are currently under more pressure than ever to comply with federal hiring laws, and that starts with properly managing Form I-9 and E-Verify requirements.

Mistakes in this process can lead to steep penalties, failed audits, and serious reputational damage. That’s why more businesses are turning to I-9 compliance software solutions to simplify and automate the process.

Pros

• Rapid delivery of valuations; just a few days, not weeks.
• Rigorous methodology aligned with regulatory standards; lifetime audit support included.
• Users consistently praise Pulley’s intuitive interface and exceptional customer service. The onboarding is simple and smooth for early-stage teams.
• Clearly tiered plans make budgeting straightforward; beneficial for early-stage startups.

Cons

• Despite its strengths, Pulley is newer and less established compared to market incumbents like Carta; something some VCs or auditors may notice.
• Some sophisticated tools and integrations may require more expensive plans, potentially impacting very early-stage startups on tight budgets.
• Compared to longstanding competitors, Pulley may offer fewer integrations with external systems out of the box.

#3 Morgan Stanley Shareworks

Morgan Stanley Shareworks, originally Solium and now integrated within Morgan Stanley at Work, provides a sophisticated 409A valuation service embedded in a full-featured equity management platform.

This combination of robust software and valuation expertise gives startups a seamless means of managing equity and compliance through one trusted provider.

Ideal Use Case

This solution is well-suited for mid-stage to growth-stage startups that require more than just valuations. If you need cap table management, scenario modeling, audit-ready reporting, and long-term scalability, Shareworks is ideal.

It’s also highly suitable for companies preparing for pre-IPO or those navigating complex liquidity or secondary transactions.

Turnaround Time

Shareworks’ valuation process involves several structured phases: kickoff (data collection), a management call to vet assumptions, draft modeling and exhibits, review and feedback, and final valuation delivery.

While Morgan Stanley doesn’t explicitly advertise a “rush” timeline, most startups can expect completion within a couple of weeks once due diligence begins.

Audit-Readiness

Shareworks excels in audit defensibility. Morgan Stanley’s 409A leaders deliver transparent, audit-ready valuations backed by decades of valuation experience, including 260+ client IPOs, over 3,100 clients, and $14 billion in private market liquidity volume.

Their process supports compliance with IRS safe-harbor criteria and stands strong in SEC and auditor reviews.

Pros

• Combines valuations with cap table, modeling, and equity reporting all in one workspace.
• Deep valuation expertise, supported by industry veterans like Steve Liu, with Big-4 and SVB Analytics backgrounds.
• Strong track record defending valuations during audits, IPO preparations, and secondary events.
• Designed to support companies across multiple stages, including public-stage readiness.

Cons

• This premium solution may not be the most cost-effective for early-stage or pre-seed startups seeking the fastest turnaround. The process usually spans a couple of weeks, which may feel long for time-sensitive rounds.
• With advanced features comes added complexity. Smaller startups might find the full platform more than they need, both in onboarding and monthly subscription costs.

#4 Eqvista

Eqvista has earned its place as a top-tier choice for startups seeking fast, cost-effective, and audit-ready 409A valuations.

Powered by NACVA-certified valuation analysts, the firm delivers professionally defensible reports while offering compelling value, especially through its “unlimited valuations for 12 months” model.

Ideal Use Case

Ideal for early- to mid-stage startups that anticipate frequent material events (like fundraising rounds or employee option grants), Eqvista is a go-to for teams that need compliance and agility without the premium pricing of Big-4 firms.

Turnaround Time

Standard valuations complete within 5 to 10 business days. For startups pressed for time, Eqvista offers a rush service (3 to 5 business days) for an additional fee (around $490), which includes daily progress updates.

Audit-Readiness

Reports are IRS-compliant, following AICPA guidelines. The valuations are performed by certified analysts and are defensible in audits, with evidence of auditor acceptance in client testimonials.

Pros

• Highly cost-effective with unlimited valuations. Great for startups experiencing rapid growth.
• Responsive, transparent customer support, with clear explanations and seamless process flow.
• Integrated cap-table management and financial modeling capabilities; a bonus for equity-heavy startups.

Cons

• The 12-month unlimited valuation window may fall short for hyperactive startups needing even more frequent updates.
• Some clients have noted the lack of a fully guided portal experience, with document submissions handled over email rather than through a more polished dashboard.

#5 Aranca

Aranca, a globally recognized research and valuation advisory firm, has been conducting 409A valuations since 2005. Trusted by over 2,000 companies (from startups to Fortune 500s), their pedigree blends deep research capabilities with financial advisory services.

Ideal Use Case

Aranca is well-suited for mid- to late-stage companies or those preparing for high-stakes events like M&A or IPO.

While early-stage founders may find it on the higher end of the price spectrum, its reputation, rigor, and lifetime audit support make it a compelling choice for firms that need defensibility and credibility.

Turnaround

The typical delivery window for a 409A valuation via Aranca is 7 to 10 business days, though actual times may vary depending on complexity.

Audit Readiness

What sets Aranca apart is its audit-ready methodology. Analysts dedicate at least 40 hours to each valuation, delivering reports that withstand scrutiny from Big Four audit teams, the IRS, and the SEC. They also offer lifetime, free audit support, shifting the burden of proof away from the startup.

Pros

• Strong global research and financial advisory expertise with a long-standing track record.
• Dedicated effort per valuation (minimum 40 analyst-hours) ensures quality and defensibility.
• Rapid turnaround (approximately 7 to 10 business days) balances thoroughness with timeliness.
• Offers lifetime audit review support at no additional cost.

Cons

• Pricing starts at around $1,299 but often runs higher for complicated or expedited cases.
• May feel less tailored to very early-stage startups seeking lean, rapid valuations.
• The report focus spans advisory breadth, which may dilute the laser focus some startups want in a valuation specialist.
• More boutique or subscription-based providers may offer more predictable or startup-friendly pricing and flexibility.

#6 Andersen

Andersen (formerly Andersen Tax LLC) is a nationally recognized, full-service valuation and financial advisory firm with a deep bench of experience in executing 409A/ASC 718 valuations.

Maximizing thousands of engagements across all startup stages, Andersen brings the credibility of working with every major VC and private equity firm, and its valuations are regularly accepted by all major accounting firms.

They are also experienced in supporting clients through IPO readiness, audit reviews, and SEC examinations.

Ideal Use Case

Startups preparing for institutional funding, approaching IPOs, or managing complex capital structures will find Andersen’s services valuable.

Their emphasis on audit-defensible methodologies and frequent interaction with auditors and the SEC makes them a strong choice for high-growth companies seeking top-tier, defensible valuations.

Turnaround Times

While Andersen does not publish exact timelines, their comprehensive audit-readiness and deep methodology suggest valuations may take longer than those of more automated or boutique providers.

Clients should expect a more deliberate process, potentially several weeks, especially when preparing for IPOs or audits.

Audit-Readiness

Andersen differentiates its deliverables by incorporating methodologies specifically called for by the IRS and anticipated by external auditors. Their valuations have repeatedly passed scrutiny during audit and IPO processes.

Pros

• Trusted by VCs and PE firms, and well-received in audits and IPO pipelines.
• Their reports are designed from the ground up for defensibility.
• Beyond valuations, they offer tax, financial advisory, and broad consulting support.

Cons

• Andersen’s premium, institutional-grade valuations come with higher fees, which might be out of reach for early-stage or budget-conscious startups. (Although exact pricing isn't publicly disclosed, larger established firms generally command significant fees.)
• The depth and rigor of their approach can mean slower delivery compared to providers offering rapid, templated valuations.
• Their sophisticated models and methodologies may require more coordination and documentation from startup teams, potentially increasing administrative effort.

How to Choose the Right 409A Valuation Provider for Your Startup

To choose the right 409A valuation provider for your startup, match the provider's strengths to your startup's growth using the tips below:

Pre-seed / Seed

At this stage, your budget is tight, and timing is important. You need a 409A provider that delivers reliable, audit-ready valuations quickly and affordably without compromising on compliance.

Platforms like Eqvista and Pulley are ideal here. For example, Eqvista starts at around $990, with delivery in 5 to 10 days (and rush options in 3 to 5 days). Pulley provides a turnaround of 2 to 5 business days for standard valuations.

Series A-B

Once you're raising meaningful rounds, your valuation needs must withstand investor diligence, potential audits, and complex capital structures. Seek providers who deliver detailed methodology, transparent assumptions, and defensibility.

Platforms like Carta and Pulley integrate cap table management with 409A compliance. Carta's valuations are IRS safe-harbor certified and well recognized by auditors. Pulley emphasizes clarity and investor confidence with defensible models, strong analysis teams, and ongoing support.

Make sure your provider offers flexible pricing tiers and the capability to support changes in capitalization tables.

Growth/Pre-IPO

As your company approaches IPO or matures beyond mid-market, the stakes of your 409A valuation increase. Here, you want seasoned firms (often from the Big 4) who bring global compliance experience, rigorous audit defense, and institutional credibility.

Deloitte, EY, PwC, and KPMG offer comprehensive advisory, tax, and valuation services, though fees usually begin around $10,000 and can go up to $50,000+, and turnaround times may extend due to extensive review cycles.

The table below offers a glance at matching provider strengths to your startup’s needs:

How Chore Helps You Get a Fast, Audit-Ready 409A

Chore acts as your fractional back office for HR, compliance, finance, and equity, so your 409A process runs smoothly end-to-end. We prepare cap tables, option grants, and equity templates, then coordinate with your chosen valuation firm.

Need speed? Chore gathers SAFEs/notes, cleans financials, reconciles headcount/payroll, and assembles a data room. This accelerates provider turnaround and strengthens audit defensibility.

With Chore, you’ll experience fewer back-and-forths with analysts, shorter cycles from request to draft/final, and lower total cost of ownership because your finance and equity workflows are handled by one team instead of multiple vendors. That means compliant grants now for founders, without derailing a fundraise or hiring plan.

Ready to get an audit-ready 409A moving this week? Talk to Chore. We’ll prepare your equity and coordinate the valuation so you can focus on growth.

FAQs

How much does it cost to get a 409A valuation?

The cost of a 409A valuation varies, from under $2,000 for very early, simple cases to tens of thousands for highly structured, near-IPO companies. While it's tempting to opt for the cheapest provider, remember that audit defensibility, methodology integrity, and provider reputation are often worth the investment for long-term compliance and founder peace of mind.

Who performs 409A valuations?

409A valuations must be performed by qualified independent third parties with expertise in business valuation, financial modeling, and compliance with IRS Section 409A. While technically a company can attempt an “internal” valuation, the IRS only grants Safe Harbor protection if it’s conducted by an independent, experienced professional.

How often should startups get a 409A valuation?

Startups should update their 409A valuation at least once every 12 months or sooner if a “material event” occurs. The IRS Safe Harbor rules require that a 409A valuation be valid for only 12 months unless something significant happens that could affect your company’s fair market value.

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