What does Equitable Venture really mean for founders?
Every entrepreneur we invest in becomes a co-owner of the fund. We call it equitable venture. We do this to align our ambitions and achievements with the founders we back. Oh and our advisers and team members too.
This means that we share the upside of the fund with you. After all commitments have been returned to our fund investors, we all share at least 20% of the funds profits - you get to share in the success of the other entrepreneurs around you.
We do this by allocating each entrepreneur carry points. We allocate these carry points equally to each company and within each company to the founders personally pro-rata to their shareholding in their business.
Much like your options pool, your carry points will vest over five years, with 20% vesting on the 1st anniversary of your allocation, and then vesting monthly until you’re 100% vested on the 5th anniversary. It’s the same for us.
When profits are ultimately shared (venture is a long game after all), you will receive a share of any profits in line with your share of the carry points.
You may be thinking what if I decide I’m not what’s best for my business, what if we go under, or what if we are acquired - will I still be a co-owner of the fund? The short answer is: yes. So long as you’re not considered a ‘bad leaver’. We want you to retain carry because you are still a valuable member of the community, and often there are just as many lessons to learn from failure as from success.
We have structured the fund in this way, so that as co-owners, you will develop and reinforce the relationships and reputation that drives great investments, influence and returns.