Choosing the Investment Structure

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In setting up an angel network, you need to choose an investment structure.

Here are some structures to consider: 

Individual investments -- the members can each decide if they want to invest and how much to invest in each deal.

This allows for maximum flexibility for the members to invest in the deals they want.

The drawback is the administration is high, as you must work with each investor in determining their amount of investment and signing of the documents.

Group investments -- the members invest as a group.

In this structure, the investors can create a pledge fund so the group decides which deals to pursue.

The members have some decision-making control over the investment decisions.

This reduces the administrative overhead.

The group can also choose to create a fund in which a screening committee or manager determines which investments are made.

This requires the least amount of administration as the manager or committee makes the decisions on their own. 

The group can also choose to create a sidecar fund that invests from a fund into deals the members have funded individually.

The sidecar fund provides members diversification on top of their individual investments.

This is also a low-cost administrative structure as the sidecar investment is typically a calculation based on the members’ investment and does not require a manager to run it.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
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This is Investor Perspectives. I’m the host of Investor Connect, Hall T Martin, where we connect startups and investors for funding.

In our new Investor Perspectives series entitled “How to Solve the Real Estate Problem”, you’ll hear about the primary trends and what makes for a successful company in this space.

As the COVID pandemic passes, we emerge into a new world. The real estate space is now undergoing tremendous change as we shift to a new normal way of life. Work from home and the shift to work from anywhere is changing the real estate market. We have investors and startup founders describe the changes coming up.

Our guests are:

Chi Hathiramani, Chief Investment Officer, Casoro Group 01:25
Brent Bowers, CEO, The Land Sharks 02:52
Lauren Hardy, Founder, TMF Real Estate 05:09
Wade Micoley, Founder and CEO, RealtyHive 08:33

We hope you enjoy the show.
_______________________________
For more episodes from Investor Connect, please visit the site at: http://investorconnect.org 

Check out our other podcasts here: https://investorconnect.org/ 
For Investors check out: https://tencapital.group/investor-landing/ 
For Startups check out: https://tencapital.group/company-landing/ 
For eGuides check out: https://tencapital.group/education/ 
For upcoming Events, check out https://tencapital.group/events/ 

For Feedback please contact info@tencapital.group  

Please follow, share, and leave a review.

Music courtesy of Bensound