Who does background checks on startup founders? Is this is part of the process of due diligence for each deal?
There's obviously pro-rata considerations which I think provide a floor, but beyond that, what other considerations should we be thinking about?
This is for portfolio construction modeling and some assumptions that we're making.
Do GPs assess a management fee on interest collected on deposits and is it recognized by the carried interest provision as another source of fees ?
Our fund's investor demographic will include US and Southeast Asians. What regulatory regime would be most favorable given the diversity of our investors?
Would there be a way to access the draft of the compliance policy on this platform?
Would there be a functionality within the Decile Hub to auto generate the first draft of some of the key legal documents, such compliance policy or valuation policy, related to the venture capital deals?
Adam Miller
Here the ideal structure for a Venture Studio is laid out, showing 5 legal entities - (1) Management Company, (2) General Partner, (3) Limited Partner, (4) The Venture Studio / Accelerator (operations), and (5) An Individual Company (created by the Venture Studio / Accelerator). While researching, its been suggested that the Venture Studio operations (4) be created as an LLC with the individual companies (5) being incorporated as C-corps, though I'd like some validation or refutation of this.
For a fund with international investments, does DecileHub track differences in currency? Or is the best practice to simply keep all investments denominated in one currency?
Lots of GPs I talk to mention they are basically equivalent, Decile Hub didn't give me much context on this either.
Guessing if you can would need a .au domain I know crowdfunding is out as that is licensed, not that I would wan to do that.
Mau Robles
Obviously since the GP is making the Capital Call, it knows that he also needs to deposit his share of the funds, but I assume that that should be registered formally somewhere in the system and I couldn't find where. The GP does not appear in the Capital Commitment table when you use the option to make a capital call, so wondering if it gets roped in automatically.
Mau Robles
I'm looking at an example were the “Proceeds from Sales of Investments” balance equals the “Cash and Cash Equivalents” balance, but these are supposed to be funds from a recent capital call that are temporarily in the fund's bank account as they are already committed to be transferred to portfolio companies to pay for new investments. I don't how is it possible that it got registered as “Proceeds from Sales of Investments”. Can this simply be a journal entry error?
Mau Robles
I'm looking at an example where a fund has two investments of $25K in 5 companies (so total of $50K per company and total of $250K capital invested). So the breakdown for each PortCo in the Schedule of Investments shows two investments of $25K in each case, with the first line of the entry showing a total of $50K and the last line only showing $25K for some reason. Can this mean that the fund is currently only holding one of the two investments and thus the last line in each PortCo entry is just showing the fund’s current balance? Here are some more details on the example I'm looking at: • Clicking on each Portfolio Company’s name, their respective “Founding Rounds” tabs seem to confirm that indeed the fund has made two $25K investments on each company. But the strange thing is that on the Schedule of Investments both investments appear with the same date (February 17, 2024) while on the “Founding Rounds” tabs they don’t (second investments are dated June 10 or June 17, 2024), which almost seems to be an error on the platform. • Since there are 5 companies in the portfolio, each with two $25K investments from the fund, that’s a total of $250K in invested capital (which is confirmed in the Fund Overview section, under “Now / Investable Capital / Invested”), but in the Balance Sheet though the “Cost of Investments” is -$125,000 ($25K times 5 investments registered at cost) which appear to indicate the fund is currently only holding one of the two investment it made on each company. • Balance Sheet also shows under “Cash and Cash Equivalents” a balance of +$115,000 (meaning $125,000 less $10,000 in Management Fees), which seems to indicate that the second $25K investment in each company hasn’t been made yet and the money is still the funds bank account. This will be unlikely if the investment dates on the Schedule of Investments were correct (February 17, 2024), but the fact that the dates on the second investments as per the “Founding Rounds” tabs is more recent (June 10 or June 17, 2024), it may be possible that the funds just haven’t been transferred to the portfolio companies yet and that’s why the last line on each portfolio company entry on the Schedule of Investments only shows one of the two investments.
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