Seed stage CEOs: less dilution, more equity upside(harveymultani.substack.com)
harveymultani.substack.com
Seed stage CEOs: less dilution, more equity upside
https://harveymultani.substack.com/p/v5-ceo-first-employee-led-spvs
6 comments
I have no idea what this is after reading it.
This explains it: https://harveymultani.substack.com/p/startup-employee-syndic...
The idea is for employees to raise money from their network into a special purpose vehicle, and have that SPV invest in their employer, charging a 20% carry to the other investors in the SPV
The idea is for employees to raise money from their network into a special purpose vehicle, and have that SPV invest in their employer, charging a 20% carry to the other investors in the SPV
Sounds like a lot of hassle/potential distraction.
>$4m raised through employee led SPVs to date. So far, process has been seamless and relatively low time cost for all parties. Happy to go into more detail if helpful
Every professor I had in undergrad would dock me 5-10 points for using an acronym without defining it first. It took me two clicks to get to the definition of SPV (special purpose vehicle?), which is pretty meaningless to someone who doesn't spend their day thinking about equity.
Apologies, a SPV (special purpose vehicle) is effectively a single use VC fund that is created to purchase a single asset and is funded completely upfront. In comparison a standard VC fund targets the purchase of multiple assets and calls capital from investors as opportunities arise.