Fri, 19 November 2021
Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.
In setting up a university angel network, you’ll need fund documents for the prospective members to review.
You’ll need to establish a legal entity for the fund, typically an LLC.
After that, you’ll need to write the company agreement documents.
This includes the formation of the fund, its term, purpose, and more.
You’ll need a subscription agreement for members to sign indicating their investment commitment to the fund.
Venture capital funds use a General Partner and Limited Partner structure.
Angel group funds often use the Investment Club model.
Everyone is a member of the group with specific persons assigned roles such as manager, screening committee, etc.
This simplifies the reporting to the members and the tax authorities.
Members must be accredited investors as the investments are made under Section 501, Regulation D.
For setting up your fund, start with a core group of angel members to understand the size of the fund, purpose, and type of deals you intend to pursue.
With their support, continue to build out the documents.
After you set up a legal entity, launch the fund to the wider university community.
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