Ask AI
Log In Sign Up
Go to General VC Questions
Previous Question Next Question
1
General VC Questions
dilution follow on pro rata

If I make an investment in Fund I with no follow-on reserves, can I follow on that investment in Fund II using the pro rata rights from Fund I?

Asked by: Rowena Luk
1
0
Jun 19, 2024
Fund I has no reserves and is investing in Seed stage. 

In future, I hope to establish a Fund II with follow-on reserves, investing in Seed plus Series A. 

If I get pro rata rights from my investments in Fund I, can I use those rights to invest using the new Fund II? 
1 answer
1
Mike Suprovici
Accepted Answer
Jun 19, 2024
The best practice is to offer that pro-rata to fund 1 LPs first via SPVs. Next, bring the investment to your LPAC to clear any conflicts. Then, make the investment. 
🙏 1
Add a comment

Log In or Sign Up

Please Log In, or Sign Up to participate in the discussion.

Log In
or
Sign Up

Apply to VC Lab Cohort 17

Get full access to Decile Base and the Decile Hub venture platform for free by joining the VC Lab program.

Apply to VC Lab Cohort 17
Related Questions
Can a Small Angel Investment Be Used to Warehouse a Deal and Later Match Fund Investment Thesis? 0 May 03, 2023 Can I just invest as an individual and move it to the fund at a later stage? 0 May 03, 2023 Can we switch the thesis on a fund mid-stream? 1 May 03, 2023 Can We Double Down on a Company Investment Through Fund II if Already Invested in Fund I? 1 May 03, 2023 Is there any situation where it’s acceptable to not perform AML/KYC on Limited Partners during a fund closing process? 1 Nov 21, 2024