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409A provider

Also called: valuation firm, 409a firm

In one line

The independent firm a company hires to perform its 409A valuation of common stock.

In plain English

Companies use specialist valuation firms (often their cap-table provider) to run the 409A. The resulting number sets strike prices and the official common-share value.

If you were explaining it to a 5-year-old

The neutral referee the club hires to decide what one toy is fairly worth.

Why it matters when you sell

The 409A they produce is a reference floor for your common value when estimating a sale price.

Related terms

409A valuationFair market value (FMV)Strike price

Put it to use

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Sources

Primary references for this term: IRS (US tax). Our definitions are written in plain English and kept evergreen — see the glossary methodology. General information, not advice.

Educational information only — not financial, tax or legal advice, and not an offer to buy or sell any security. Definitions are general; your own documents and local law govern your situation. PrivateTechShares is independent and not a broker or marketplace.