Frequently Asked Questions

Q: What is a syndicate?

A: A syndicate is a group of individual angel investors who pool their resources to invest collectively in a startup. This collaborative approach allows investors to share the risks and benefits of investing in early-stage companies. Here's how it typically works:

1. Formation:

- A syndicate manager identifies a promising startup.

- The lead forms a syndicate by bringing together other individual investors interested in participating.

2. Due Diligence:

- The syndicate lead conducts due diligence on the startup, assessing its business model, market potential, team, and financials. This information is shared with syndicate members for review.

3. Investment Decision:

- Based on due diligence, members of the syndicate decide whether to invest in the startup. Members are not obligated to invest in each start up. All investment decisions are left to individual members.

- Each member contributes a portion of the total investment amount.

4. Terms and Agreements:

- The syndicate negotiates investment terms with the startup, including equity ownership, valuation, and any protective provisions.

6. Investment Execution:

- Once terms are agreed upon, the syndicate collectively invests in the startup.

7. Post-Investment Involvement:

- Members may continue to support the startup by providing mentorship, advice, and connections.

- The syndicate lead maintains communication with the startup to monitor progress and shares this information with members.

Q: Why is a syndicate good for founders?

Access to Capital:

- Syndicates can provide startups with a larger pool of capital compared to individual angel investors.

2. Expertise and Network:

- Founders benefit from the collective knowledge, experience, and industry connections of multiple investors in the syndicate.

3. Efficiency

- The syndicate model streamlines the investment process, making it more efficient for both founders and investors.