San Francisco fundraising site AngelList launches VC fund Maiden Lane to invest in syndicated deals
AngelList announced that it has launched its new venture capital (VC) fund called Maiden Lane. This $25-million fund will exclusively back syndicated AngelList deals, according to VentureBeat.
Maiden Lane will give $200,000 to every angel investor to be invested in hand-picked deals on AngelList. The VC fund provides a cheaper way for limited partners to gain money through investments and a chance for investors to enter bigger deals. The fund will not charge any management fees but will charge a 30% carry, or the profit gained from the investment. One-third of the carry will be earned by Maiden Lane's managing partners. In contrast to the conventional VC method, a 2% management fee is charged, plus a carry of 20% to 30%, the report detailed.
Through syndicated deals, bigger angel investors can allow others to ride on a deal and charge a 15% carry for the deal entry alone. AngelList earns a 5% carry for the transaction, the report added.
Cendana Capital, Venture Investment Associates, and Makena Capital Management are among the limited partners of Maiden Lane. Some of the angels that the VC fund will back are Joshua Schachter of Delicious, Elad Gil of Stripe Investor, and writer Andrew Chen, VentureBeat reported.