Answer to Venture Fund vs. Syndicate Brainteaser
 Share
The version of the browser you are using is no longer supported. Please upgrade to a supported browser.Dismiss

View only
 
ABCDEFGHIJKLMNOPQRSTUVWXYZAA
1
The following assumptions were made in order to complete the model:
2
*All investments were completed in year one
3
*The venture fund has the standard, 10-year life
4
*The venture fund mgmt fee applies to committed capital
5
*The average deal-size on Angel List is: $300k
6
*The max iniitation fee for deals on Angel List applies, which is $8k
7
*Returns for each investment are calculated at the end of the 10-year horizon, there is no time-value-of-money component and this assumes all distributions to LPs occur at the end of the horizon for both the fund and the syndicate, which is often not the case
8
9
Venture FundSyndicate
10
Standard VariablesFund-only VariablesStandard VariablesSyndicate-only Variables
11
Mgmt Fee (%):2.5%Fund Length (yrs):10Mgmt Fee (%):0%Angel List Carry (%):5%
12
Fund Carry (%):20%Fund Fees:$800Syndicate Lead Carry (%):15%~Initiation Fee / Deal ($):$8,000
13
LP Invests ($):$100,000Blended Mgmt Fee over fund-horizon2.25%LP Invests ($):$100,000Average Deal-Size ($):$125,000
14
Amount to be Invested ($):
$76,700Mgmt Fee ($):$22,500
Amount to be Invested ($):
$93,600Target Investment / Startup ($):$10,000
15
% of Initaiton Fee that applies to LP Investment (%):8%
16
Initation Fee for LP / deal ($):$640
17
18
Investments:Amount Invested ($)Cash-on-cash Return ($)Investments:Amount Invested ($)Cash-on-cash Return ($)Deal-by-Deal Carry for Syndicate Lead ($)Deal-by-Deal Carry for Angel List ($)
19
Startup 1$7,6700Startup 1$9,360000
20
Startup 2$7,6700Startup 2$9,360000
21
Startup 3$7,6700Startup 3$9,360000
22
Startup 4$7,670$7,670Startup 4$9,360$9,360$1,404$468
23
Startup 5$7,670$11,505Startup 5$9,360$14,040$2,106$702
24
Startup 6$7,670$15,340Startup 6$9,360$18,720$1,404$468
25
Startup 7$7,670$38,350Startup 7$9,360$46,800$5,616$1,872
26
Startup 8$7,670$76,700Startup 8$9,360$93,600$12,636$4,212
27
Startup 9$7,670$115,050Startup 9$9,360$140,400$19,656$6,552
28
Startup 10$7,670$230,100Startup 10$9,360$280,800$40,716$13,572
29
30
Total Portfolio Return$494,715Total Portfolio Return$603,720
31
Inital Amount Returned to LP ($):
$100,000
32
Profit ($):$394,715
33
Portfolio Carry ($):$78,943
Carry is applied at the portfolio-level
Carry ($):$111,384
34
Total Return to LP ($):$415,772Total Return to LP ($):$492,336
35
Return Multiple:4.15772Return Multiple:4.9
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
Loading...