Unlocking Liquidity: How Secondaries Benefit VCs and Early Investors in Venture Capital
In the world of venture capital, where long-term investments and illiquidity are common, secondaries have emerged as a valuable tool. These transactions provide liquidity options for venture capital firms (VCs) and early investors, allowing them to manage their portfolios effectively and generate returns before the occurrence of a significant exit event like an IPO or […]
Understanding a SAFE – Simple Agreement for Future Equity
In the realm of startup financing, a SAFE (Simple Agreement for Future Equity) has gained popularity as an alternative to traditional convertible notes. Developed by the US-based startup accelerator Y Combinator, a SAFE is an investment instrument that enables early-stage companies to raise capital in a simplified and streamlined manner. In this article, we will […]
Why Venture Capitalists Dislike Messy Cap Tables in Startups
When venture capitalists (VCs) evaluate startups for potential investment, one critical factor they consider is the cap table, or capitalisation table. A cap table outlines the ownership structure of a company, including equity ownership, shareholders, and various classes of shares. VCs generally have a strong aversion to messy cap tables, which can create complexities, legal […]
Understanding Accredited Investors: Unlocking Investment Opportunities
In the world of investing, accredited investors hold a privileged status that grants them access to exclusive investment opportunities. Recognised for their financial sophistication and ability to bear higher risks, accredited investors enjoy greater flexibility in investing in various asset classes. In this article, we will explore the concept of accredited investors, their significance, and […]
Building a Strong Foundation: Best Practices for Emerging VC Fund Managers
Venture capital (VC) plays a critical role in fueling innovation and supporting the growth of startups. For emerging VC fund managers, establishing a successful fund and navigating the competitive landscape can be a challenging endeavor. To help aspiring managers set a solid foundation for their ventures, this article outlines key best practices for emerging VC […]
Investing in Startups: Choosing Between SAFEs and Direct Equity Investments
Investing in startups can be an exciting and potentially lucrative endeavour for investors. However, deciding on the most suitable investment vehicle is crucial for maximising returns and aligning with investment goals. Two popular options for startup investments are investing via a SAFE (Simple Agreement for Future Equity) or directly acquiring equity on the cap table. […]
A Closer Look at Limited Partners (LPs)
In the world of investment partnerships, limited partners (LPs) play a significant role as passive investors. LPs contribute capital to various investment funds and partnerships and typically have limited involvement in the day-to-day operations. Here, we explore the concept of limited partners, their role in investment partnerships, and their specific relevance in the context of […]
Navigating a Down Round: Tips for Startups
As a startup founder, you may have heard the term “down round” before. It’s a funding round in which a startup raises money in a funding round at a lower valuation than its previous round, and it can be a sign of trouble for your startup. But don’t worry – there are steps you can […]
Demystifying Special Purpose Vehicles (SPVs)
If you’re running a business or thinking of starting one, you may have come across the term “SPV” or Special Purpose Vehicle. At first glance, it may sound like a fancy car or something that only astronauts use, but in reality, it’s a popular business structure that offers a range of benefits. So, is an […]
Should I Raise a Fund or Start with SPVs?
Deciding whether to raise funds or start with special purpose vehicles (SPVs) depends on several factors, such as your investment strategy, the size of the investments you plan to make, your investor network, and your ability to manage and operate a fund. Here are some pros and cons of each option to help you make […]
