How Carta makes phantom equity simple for Athena LLC

Limited liability companies (LLCs), unlike corporations, are not able to issue the typical forms of equity such as stock options or restricted stock units.

However, LLCs can issue other forms of employee ownership—including so-called phantom units that mimic the company’s market value—as a way to attract talent and make sure employees and contractors can share in the long-term success of the company.

For Athena, a Puerto Rico-based LLC established in 2021, that means a phantom equity compensation program. The company, which through its platform connects founders and operators with executive assistants around the world, uses Carta to offer phantom equity to more than 1,000 employees and contractors.

Athena’s Phantom Unit Plan functions as a deferred bonus program. While Athena does not issue ownership or membership units, it may grant rights to any future value in the business. This structure enables LLCs to distribute cash to phantom-equity holders upon an identified payout date, a liquidity event such as a merger or acquisition, or an initial public offering.

Administrating Athena’s Phantom Unit Plan through Carta has been “seamless,” says Wilson Hung, head of growth at Athena. “Carta offers us a streamlined platform for various essential tasks. This includes the distribution and execution of award agreements, real-time monitoring of available granted and vested phantom units, and the efficient handling of critical plan documents.”

“Our Phantom Unit Plan is more than just your average bonus; it’s a tangible acknowledgment of our people’s pivotal role in driving Athena’s ongoing success,” says Wilson.

“Our choice to have this program aligns with our unwavering commitment to recruiting and retaining talent for the long term, in harmony with our company’s core value of ‘Always Long Term’,” he says.

Plan management with ease

The Athena team appreciates that the Carta dashboard is user-friendly, says Wilson, and that data is easy to download. “It allows us to effortlessly monitor vested phantom units and access key vesting calculation dates and some other important files related to Phantom,” he says.

The Scenario Planning feature allows the Athena team to test various alterations to the plan before making any changes. “It enables us to make informed decisions, potentially avoiding costly missteps and saving valuable time that might have been spent on trial-and-error approaches,” says Wilson.

Employee can see value in real time

The Carta platform enables the participants, who are usually employees or contractors, to view and access their phantom units and associated Phantom Plan rules, with the estimated value calculated using Athena’s internally developed Phantom Unit Calculator, says Val Estela, senior finance analyst at Athena.

“Participants can sign in and see the number of granted phantom units and vested phantom units they have,” she says. Seeing their units in real time makes it “something they can hold on to.”

That streamlined visibility saves time and headaches for the company.

“Carta works. We don’t need to email things to employees one by one,” Val says. “I don’t have to go over my files and then tell them that this is their vested phantom units or these are the phantom units that have not yet vested. They can access it through Carta and they can see what they have anytime.”

“It’s an important thing for people in Athena to see that they are really valued,” says Val. “And providing the ability to share in the company’s long term success—and see concretely how that works any time—is key to that.”