May 7, 2014
Barbara Corcoran, the famous Shark Tank investor, has officially started her own AngelList Syndicate called Barbara Corcoran Venture Partners. They have announced that they will syndicate all of their deals outside the ones that Corcoran funds on Shark Tank.
For those of you who might be unaware of the finer points of syndicates, you should know that they allow investors to co-invest with other notable investors. That is, people who back a notable investor’s syndicate commit to invest in their future deals and agree to pay them carry, or a percentage of the profit of a fund.
The example that AngelList gives hits the nail on the head: Sara, a notable angel, decides to lead a syndicate. Investors ‘back’ her syndicate by agreeing to invest $200K in each of her future deals and pay her a 15 percent carry. The next time Sara decides to invest in a startup, she asks the company for a $250K allocation. She personally invests $50K in the startup and offers an opportunity to invest up to $200K to her backers.
With regard to Barbara Corcoran Venture Partners, the fine print reads that the total carry per deal will be 20 percent. Barbara Corcoran Venture Partners is expected to syndicate 12 deals per year at $50,000 per investment, and the minimum backer investment is $1,000. Ever since she first appeared on Shark Tank, investors have been dying to get in on the action with Corcoran; now they finally can.
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