What is the investment structure used for syndication?
There are two types of investment structures that Funderbeam uses for syndicated investments: an SPV or a Nominee.
In making their investment, investors will subscribe to Loan Notes issued by the special-purpose vehicle (SPV).
The SPV then invests the collective principal amount of the loans in the investee company, based on the terms agreed in the relevant investment agreement.
The SPV becomes the legal shareholder of the fundraising company. A unique SPV is created for each fundraising company that completes a funding round through the platform.
Investors make their investment in the shares of the fundraising company via the Nominee, which holds the issued shares on their behalf.
Funderbeam acts as the Nominee shareholder in the interest of the investors, who are the beneficial owners of the investment.
What instruments do investors get?
With the nominee, the investor receives the instrument specified during the investment round i.e including whether it is share units, shares, or convertible notes. In the case of an SPV structure, investors always receive a loan note that has the right to any proceeds that arise for the underlying instrument.
How is the information displayed on the company investment offer page?
This is how the information will be displayed in the Terms section, it will reflect investor instrument, company instrument, and investment structure – what we discussed above.