A Syndicate is a group of individuals or organizations combined to promote some common interest. Startup investor syndicates have a common interest in investing in particular types of startup deals.
Syndicates pool capital from multiple accredited investors into a single fund, which then invests in the startup.
Startup investor syndicates have been successfully implemented on AngelList and other investment platforms. The Syndicates allow accredited investors to fund startups brought to the platform by Syndicate Leads – experienced angel investors who have vetted the target investment and are investing their own money in deals, which demonstrates their confidence in the investment’s potential.
The Unboxed syndicate is an easier way for angel investors, and those that want to start, to find and invest in well qualified startups, and for startups to find well qualified angel investors, advisors, and mentors. We use a modern, ‘virtual angel group’ model to achieve this. In this model, accredited investors that belong to the syndicate decide on a deal by deal basis when to invest in the startups presented to the syndicate. There can be a different group of angel investors that invest in the dedicated fund created for each deal, but they are all members of the syndicate.
Unboxed and Unboxed Supported Syndicate Managers, along with a qualified Lead investor, present Unboxed vetted opportunities ensuring high quality companies with the best potential to the Syndicate Investors for review and investment.
Around 8.2% of the US family households are accredited, but when polled, ~90% of accredited households don’t know they can invest in this way, even though the opportunity may exist locally. Syndicates allow newer investors ACCESS to invest alongside experience investors with lower barriers to entry which INCREASES ACCESS to CAPITAL for entrepreneurs.
- Investors get good deal flow
- Minimums are typically around $3 to 5K and sometimes as low as $1K which allows investors to diversify
Startups raise more money more efficiently. Startups…
- Get the supervision of a Lead who is bringing along a good size potential investment from the syndicate.
- Get access to the syndicate investors’ networks and expertise.
- Can easily manage the financials and cap table through a Special Purpose Vehicle (SPV) fund that invests in their startup, rather than adding many small investors to their cap table.
There is so much more about Unboxed and Syndication. Please contact us!