Have you been hearing about SPVs and want to learn more about them? They are an incredibly versatile investment entity used by a number of different investors and fund managers.
What is an SPV?
SPV stands for Special Purpose Vehicle which is a legal entity created to allow multiple investors to participate in a single investment.
While family offices normally invest directly, an emerging trend has been for family offices to share deal flow and invest together.
Sometimes venture capital funds will have more allocation for an investment that they are able or would like to fill out of their main fund. SPVs allow venture capital firms to invite individual LPs or outside investors to participate in the opportunity, frequently called a Sidecar SPV.
Syndicates and Angel Groups
Over the last couple years the growth of syndicates and angel groups have been staggering. By design these groups are bringing networks of investors together to participate is a single opportunity which is a perfect fit for an SPV.
Emerging Fund Managers
Starting a fund is difficult and many new and emerging fund managers find themselves spending large amounts of time building rapport with potential LPs. Instead of “selling” their investment thesis and vision, these mangers can use SPVs to bring specific investment opportunities to potential LPs.
At Syndicately, we think SPVs are the future of private placement investing. That’s why we’ve embarked on a mission to build a streamlined, easy-to-use, and fast SPV administration platform.