After working on two deals as a fundless sponsor, and seeing the booming interest in the SMB space I've been tinkering with a new project. A crowdfunding platform to raise LP funds for typical LMM PE deals.
The platform could allow syndicators (or fundless sponsors) to bring deals to the table, and raise equity or debt via the platform.
I understand the downsides regarding syndicating, time to deal close, and the fact that professional LP's might bring more than just capital.
This could be structured like Fundrise where it's essentially a fund where the LP's are just small investors. Or it could be like Angel.co with syndicators bringing deals and finding funding via the site.
If successfully launched, getting funding to underwrite deals ourselves would speed up the closing process.
Interested to get some feedback to see where the biggest blind spots are.
Hey Blinkers, I'm the WSO Monkey Bot and I'm here since nobody responded to your topic! Bummer...could just be unlucky but one of these topics will help shed some light:
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I've gone down the path with this idea. Happy to chat about it
The SEC has entered the chat
In all seriousness though, investors need to be accredited investors (Google requirements) for these transactions and you need to vet them for that. I'd also mention that this just sounds like a portal for bad actors and fraud to go wild. Plus you have to deal with information control. Either it becomes publically available to everyone that XYZ firm is for sale, but the bidder doesn't have the money yet, or the investors don't actually know what they're investing in, which is a horrible setup too.
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