1.How do I create a syndicate?

2. What is the minimum amount of investment in a syndicate I lead?

3. What are the requirements for starting a syndicate?

4. Can I use Lilypads to expand my LP network?

5. If I choose to raise on Lilypads, is it public / general solicitation?

How does receiving a Carry share work?

Leads may opt to share a proportion of their Carry with an entity in exchange for their aid in a deal. A recipient however can receive Carry only if they have rendered their assistance or skills in identifying, evaluating, or settling the deal in any capacity. Hence the beneficiary may not necessarily be accredited.

 

If you have been invited to receive a Carry, you can accept this Carry by clicking on the link which the Lead sends you. Then, you can choose a Carry recipient to receive the Carry.

 

Note that your entity will require Identity Verification. Hence, they may require authentication via a Government ID. In some cases, they need to provide necessary additional information regarding their investing entity.

 

Once you accept the invitation the Lead will automatically be notified via email and they must confirm the agreement to seal the transfer. You will then receive an electronically signed copy of the Carry share agreement via Lilypads platform.

 

2. How does sharing carry work?

A deal partner with whom you intend to share carry must already be a part of your network. They must be someone who provides substantial assistance to you and your fund in identifying, assessing, and negotiating Fund investments. This would typically include tasks such as helping in determining a potential Portfolio vehicle’s business model, calculating the share price, negotiating the terms of the investment, monitoring the investment after it is closed, and performing similar functions for any follow-up investments by the Fund. 

3. How can I discount carry?

You can choose to specify your Carry for each deal while also having the capacity to adjust your Carry for individual LPs.

 

If you want certain LPs to pay less Carry than the default amount of the SPV, Lilypads can implement the requested changes after the LP has completed the closing flow. 

 

Note that the SPV’s default should be the maximum Carry any LP inside the SPV is paying. Hence you can only adjust certain LP’s Carry level down.

 

The process is described here as follows:

 

  • LP executes the closing flow.
  • The closing flow shows default Carry. (e.g. 20%)
  • You email us to lower a particular LP to 15% Carry.
  • Then we will adjust our records.
  • Upon finalizing the SPV, we send you a link with all LPs and their Carries.
  • You can either confirm or inform us about any final edits.
  • We settle the SPV, hem-in all carries, and notify LPs.
  • Finally, LPs will be able to download the final SPV docs, along with a Carry adjustment side letter for those LPs who pay less than the default.

1.How can I increase the number of applications to my syndicate?

Probably the most effective way to boost applications to your Syndicate is to engage in myriad great deals and deal flow. To ensure that your Syndicate appears high on the LP’s search for Syndicates, the best strategy is to participate in a maximum number of active deal flow. Needless to say, a higher number of deals and deal flow will maximize the number of applications to your Syndicate.

In addition to this, when you bring a superior deal to the platform, it has a higher chance to be sent out to the Lilypads LP Network. Our Crowdfunding Capital Network (CCN) consists of high net-worth individuals who receive invites to the best deals on the platform, and if they like any deal they often choose to back the Syndicate. Furthermore, once your deal qualifies for Platform Capital Invites (PCI), you can search for LPs in the network and send up to 1000 invites for your deal. It is a great way to get positive responses as the LPs generally back good deals.

 

2. How do I accept or reject applications?

In the Invite feature in the LP network section of your Investor Network Profile (INP), you can view and respond to opportunities. Each application will show up here individually, so you can review, accept, reject or simply skip every single application and move on to the next invite.

 

3. How can I prevent LPs I don’t know from applying to my syndicate?

To prevent receiving invites from LPs you don’t know, you can opt to update your privacy choice, thereby turning your Public Syndicate into a Private one via your INP settings. Hence, your deals will only be sent out to the Lilypads LP network consisting of high-net-worth individuals.

 

4. Are syndicate investors accredited?

Yes, most Syndicate Investors are accredited whereby they are required to verify their Accreditation status to continue fundraising publicly. Most importantly, the Investors must be Accredited according to the SEC regulations which will further authenticate the degree of their sophistication and Accreditation.



 

5. What are the fees for Lilypads Platform LPs?

Lilypads charges 5% Carry on investments from these LPs. For instance, if you charge 20% Carry you will receive 15% for these LPs. Lilypads will take the remaining 5%.

 

1.How much does it cost to setup a deal?

2.Who pays the setup costs of the deal?

3.What’s the minimum allocation I need to run a deal?

4. Limitations on syndicate investments in certain foreign companies (PFIC & CFC)

5. What additional tax documentation is needed when investing in a foreign company?

1.What is the maximum number of investors that can invest into an SPV?

2.How can I see which LPs have been invited to my deal or viewed my invitation?

3. What is the Lilypads Crowdfunding Capital Network (CCN)?

1.What are Crowdfunding Capital Invites?

2.How can I see that my deal is eligible for crowdfunding capital invites?

3. How can I advertise my deal to more LPs?

4. How can I determine if Lilypads Venture Fund will invest in my deal?

5. How can I secure more capital from Lilypads?

1.What does Pending KYC mean?

2.What happens when LPs have signed but not completed their investment?

3. How can I see which LPs have signed their investment?

4. How can I see which LPs have completed their investment?

This help page and the information contained herein is provided for informational and discussion purposes only and is not intended to be a recommendation for any investment or other advice of any kind, and shall not constitute or imply any offer to purchase, sell or hold any security or to enter into or engage in any type of transaction.

Investing in venture capital funds is inherently risky and illiquid. It involves a high degree of risk and is suitable only for sophisticated and qualified investors.