Disrupt: TechCrunch & AngelList Talk Late-Stage Funding Syndicates, Global Expansion & a New Fund System

In a recent post, TechCrunch’s Jonathan Shieber shared the latest from AngelList co-founder Naval Ravikant, angel naval-ravikant-angellistinvestor Gil Penchina and CrunchFund Investor and TechCruch Founder Michael Arrington from the stage of Disrupt SF 2014, ” AngelList is expanding globally and launching new vehicles for accredited investors to back what amounts to indexed AngelList syndicate funds for the top deals on the platform.”

The AngelList platform has grown increasingly robust, and through the syndicate vehicles can now invest in — and lead — Series A rounds, according to Navikant.  Winklevoss Capital provides a case in point.

Michael Arrington“Once my first fund got to $4 million there were people who weren’t able to get into every deal,” says Penchina. “So we launched the SAAS Syndicate… the Bitcoin syndicate, which is doing two deals; the IoT syndicate and a late stage syndicate, which is going to compete with late stage investors.”

“Both Penchina and Ravikant see AngelList as a way to democratize the venture model from top to bottom, with the late-stage fund the latest shot from AngelList across the bow of traditional investors,” avers Shieber, “At issue is the dilution that early-stage investors suffer in the high-priced later-stage rounds that have become the norm in Silicon Valley (and beyond) in recent years (thanks Andreessen Horowitz).”

angellist-logo2“As the AngelList syndicates grow larger, they’re also professionalizing. Penchina has eight full-time staff working on his syndicate fund along with another 30 ‘volunteers,'” Shieber reports. “So far, Penchina has deployed $3 million across his syndicates, but expects that number to soar to $10 million over the next 12 months.”

Ravikant envisions a system that allows an investor’s fund to grow as his experience and track record evolves. “It’s a smooth path up to a fund,” from angel investment, says Ravikant. “You can add backers as you go.”

“AngelList is a way to add leverage to an investor’s checkbook,” states Shieber. “It’s additional firepower to compete jonathan sheiberagainst the more established and well-heeled investors in the venture community, and he argues it’s a better deal for the limited partners that invest in funds.”

“Institutional LPs go into individual funds now,” Ravikant says.

“Now that AngelList has managed to embed itself in the U.S. ecosystem,” explains Shieber, “it’s casting its eye on markets around the world. The investment platform is in the process of obtaining regulatory clearance in the UK with plans to move into Canadian and Australian markets shortly thereafter.”

The only problem with the AngelList model is the problem of overtaxing resources, both Ravikant and Penchin asaid. “I’m in too many deals now,” Ravikant said.

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