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.
Mau Robles
I will assume that a negative balance in an assets account would only happen if the fair market value of the investment has gone to zero and thus the balance was zero less the cost of the investment. But in the example I'm looking at, in the Schedule of Investments it is clearly shown that FAIR VALUE is positive. Another option is that maybe those investments were made using SAFE notes and thus the investments are registered at cost instead of FMV because there hasn’t been a priced round on that company yet. But if that was the case, then the Cap Adjusted section should show a valuation projection using the cap defined in the SAFE notes as the valuation of the portfolio companies, and that's not the case in the example I'm looking at. The only additional option I can think of is that maybe the SAFE notes were issued without a valuation cap and thus rely on a discount to the next equity financing round, rather than a predefined cap. But in the example I'm looking at, by clicking on each Portfolio Company’s name, their respective “Founding Rounds” tabs seem to indicate that the fund holds Common Shares and not SAFE notes.
Mau Robles
Can you select in Decile Hub whether the GP commits are to be included or not in Management Fee calculations? I tried the following sections but couldn’t find an option to do so: Back Office > Manage Capital Accounts > Type “GP” > Clicked on “Decile Admin” Back Office > Entity Management > Venture Institute Cohort 3 GP > Clicked “Edit” on both “General Partner” and “Fund”
Raymond Lee
- How are comments in the "Transaction comment" section typically structured within Decile Hub? - How is automation in activity triggered when updating valuations? Are there parameters to trigger automation?
Do the LPs receive something like a one-click invoice in the form of a capital call or a link with a personalized message from the GP?
I understand a law firm advising a venture fund should not also advise a portfolio company in that fund due to potential conflicts (especially with corporate counsel). One of our fund partners is also an attorney in a firm that does patent/trademark registration work. (The fund uses a different firm for legal counsel) With a specific scope on trademark registration, there seems to be little chance for conflict in that narrow scope -- more of a value-add. Is the answer the same regardless of the partner's firm association? Firm Partner, Fund GP, Venture Partner?
The cost of investment is $25,000 and Fair Market Value is $100,000. But the unrealized gains in the report is $125,000, rather it should be $75,000.
Rowena Luk
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?
This question came up as it tied together several common themes, including the overall success rate of emerging funds (i.e, a fund that failed will not reach profitability), fund model between distributed/concentrated/hybrid, capital deployment, and liquidity events. At the same time, emerging funds have shown the ability to outperform, so I would love to learn more about when they are able to reach profitability and greatly reduce risk while retaining upside.
