Founders’ Guide to SPVs For Fundraising
- Juliet Lawrence
- Oct 3, 2025
- 3 min read
What is an SPV?
A Special Purpose Vehicle (SPV) is a single legal entity (often an LLC) created to pool multiple investors into one line on a startup’s cap table. Founder-led SPVs, also called Founder SPVs, Rollup Vehicles (RUVs), or Cap Table Vehicles, simplify fundraising by aggregating capital from smaller checks while keeping the company’s ownership structure clean.
Benefits of using an SPV:
Clean cap table: Only the SPV appears as an investor, not dozens of individual names.
Ease for founders: Platforms handle investor onboarding, compliance, filings, and tax paperwork.
Access to capital: Allows smaller checks and diverse investors to participate without complicating future rounds.
Reputable SPV Platforms for Founders
Provider | Costs & Fees | Standout Features | More Info |
AngelList Roll Up Vehicles (RUVs) | ~$8,000 setup + ~$2,000 regulatory fees (capped at 10% of raise) | Fully managed, handles legal docs, K‑1s, compliance | |
Sydecar | 2% of capital raised (min $4,500, max $12,500) | Transparent pricing, full back‑office, easy setup for founders |
Tips for Founders
1) Minimums & timelines
Ask the platform’s minimum raise (and per-investor minimum). Some won’t open docs or blue-sky filings until you hit a floor.
Confirm closing windows (e.g., 60–90 days) and whether they allow rolling closes so early checks don’t sit idle.
Clarify refund rules if the raise doesn’t meet minimums.
2) Fees & who pays
Compare the all-in fee: setup + regulatory/blue-sky + banking + per-investor fees + tax/K-1 prep.
Check caps (e.g., capped at a % of funds raised) so small rounds aren’t fee-heavy.
Decide who pays: investors (typical), the company (less typical), or a split. Put it in writing.
3) What’s included vs. extra
Included should cover entity formation, subscription docs, KYC/AML, blue-sky/SEC filings, tax/K-1s, disbursement.
Ask what’s add-on (wire/ACH fees, international investor handling, side letters, amendments, pro-rata allocations, annual admin).
Confirm ongoing costs after the deal closes (registered agent, tax filings, investor updates).
4) Compliance & investor eligibility
Which exemption are you using (commonly Reg D 506(b) or 506(c))? That affects general solicitation and accreditation verification.
Verify the platform’s KYC/AML process and sanctions screening (especially if you have non-US investors).
Ask how they handle state blue-sky filings for many investor states (costs can add up).
5) SPV terms & governance (with the company)
Make sure your company sees one line on the cap table (e.g., “JIS Founder SPV, LLC”).
Confirm who signs on behalf of the SPV (manager/lead) and who is the single point of contact for the company.
Ensure the SPV mirrors the round terms (SAFE/price/convertible) and doesn’t create conflicting rights.
If the round grants information rights, pro-rata, or voting, decide how those apply to the SPV (and who exercises them).
6) Pro-rata & follow-on planning
Decide whether the SPV will hold and exercise pro-rata in future rounds or assign it to a lead/other investor. Capture that in the docs.
Ask how the platform manages follow-on SPVs (reuse the investor list? new entity each time?).
7) Investor experience & operations
Check the investor onboarding UX (ID verification, payment methods, investor portal).
Confirm communication cadence (who sends quarterly updates—company or platform?).
Look for a simple investor dashboard with docs, updates, and K-1 downloads.
8) Banking & disbursement
Clarify where funds are held (escrow/trust), when they’re released, and any transfer limits.
Ask about partial disbursements if you want staged closings.
Get the expected timeline from investor signature → funds cleared → company receives wire.
9) Taxes & international
Confirm K-1 preparation timing (late K-1s can frustrate investors).
Ask how they support non-US investors (W-8 forms, FATCA/CRS handling) and any withholding obligations.
10) Documentation fit
Ensure your data room has what the platform expects (charter, cap table, round docs, IP assignments, financials).
If using a SAFE, align on valuation cap/discount/most-favored nation (MFN) and how multiple SAFE flavors are handled.
For priced rounds, confirm post-money cap table impact and the share class the SPV will receive.
11) Keep it investor-friendly
For founder-led SPVs, avoid charging carry or management fees—the goal is inclusivity and simplicity, not layering costs.
Use plain, consistent updates (quarterly is common) and avoid spamming investors.
Red Flags / What to Avoid
Vague pricing (no clear breakdown or uncapped regulatory fees).
No visibility into compliance steps or K-1 timing.
Forced carry/management fees on a founder SPV.
Non-standard rights that conflict with your main round terms.
No plan for pro-rata assignment/exercise in future rounds.
Poor investor onboarding (manual back-and-forth, long delays to fund/close).
Note: This is educational content, not legal or tax advice. Always consult counsel before launching an SPV.
What matters most when choosing an SPV platform?
Fastest closing timeline
Lowest all-in cost
Compliance/Tax process
Investor UX
Comments