A few weeks ago, I briefly mentioned AngelList Funds. Today, we’re going to take a deeper look into them.
But first, a disclaimer. The AngelList Funds I’m discussing today are open only to “qualified purchasers” (QP). A QP is a person or business with more than $5 million worth of investments.
Why does AngelList make this a requirement? As usual, it’s due to federal securities laws:
Private funds are exempt from registering as investment companies if they are not making a public offering of securities and one of two criteria also applies. The fund must be owned by 100 individuals or less, or it must be owned exclusively by “qualified purchasers.”
If your financial situation is similar to mine, you don’t qualify as a QP. Luckily, you can still invest in 99% of the deals on AngelList as an accredited investor.
However, if you are a QP, I strongly recommend looking into AngelList Funds. With a minimum investment of $125,000, you get exposure to at least 200 unique startups. A new AngelList fund is launched approximately twice a year, and there happens to be one open now.
The startups that go into these funds are selected by AngelList experts, including Naval Ravikant (co-founder), Kevin Laws (CEO) and Parker Thompson (partner).
These funds are an amazing way to get exposure to a large number of high-quality startups in many different industries, including software as a service, fintech, biotech and even consumer goods.
And these funds are truly a “set it and forget it” way to access the startup market. Think of them like an S&P 500 Index fund for top startups.
This is a rare opportunity that not many people know about. So if you’re in a position to take advantage of AngelList Funds, I recommend looking into them. I doubt these funds will be available to individual investors for much longer. I suspect in the future, they will all be filled up by large institutional investors (that’s just the way things are trending based on how minimum investments have been increasing).
Learn more about these funds on AngelList here.