Minnow Ventures is a syndicate of accredited investors that supports Vermont companies and helps them grow, build great products, and create high paying jobs.
We invest across industries, primarily in Seed through Series B companies with occasional pre-seed and growth stage investments.
In the past 6 months we’ve invested in companies including EZ-Probate, Benchmark Space Systems and CoreMap. We’ve invested alongside well-known institutional investors including Hula, FreshTracks, VCET, VCF, UVM, and well-known angels from JH Capital, RuralWorks, Vernal Ventures, Venture 7, Gardener’s Supply, Burton, and LaunchVT.
Collectively, the syndicate aims to write $100k-250k checks, and will flex up opportunistically.
Why invest with Minnow Ventures?
Our minimum required check size from LPs can be as low as $2,500 (this varies by deal). Investing with Minnow can be a great way to test out angel investing on a small scale. We help aggregate early-stage Vermont deal flow in one place, and diligence companies extensively so you don’t have to. We handle all the legal, accounting, and tax events for you, including issuing K-1s and managing distributions during liquidity events.
Vermont is experiencing a “right place, right time” moment for early stage investing. The multi-billion dollar acquisitions of large local companies such as Dealer.com, IDX, and Green Mountain Coffee have enabled many promising entrepreneurs to spin out and start their own companies. Local investors FreshTracks and VCET have been building the foundation of a local startup ecosystem for decades, and new investors such as Hula and JH Capital are accelerating growth. The COVID-19 pandemic has focused attention on small, remote-friendly cities such as Burlington, with strong universities, government, and quality of life. Yet valuations of local companies are orders of magnitude below comparables in cities like San Francisco and New York.
Finally, founders love us. We help cut down the seed-stage fundraising period from 6 months to just weeks. We aggregate multiple investors into a single cap table entry. And we are investing in the long-term success of the Vermont startup ecosystem, both by making it easier for small investors to support local companies, and by deploying Minnow’s own profits back into the syndicate.
Nuts & Bolts
We will use AngelList to facilitate our syndicate. Minimum check size per deal is typically $2,500 or $5,000, and may vary by deal.
Management fee: There is no fee to join the syndicate and see our deal flow. We do not charge a management fee. If you like a company you can invest whatever amount you like above the minimum, if not you can pass. There is no obligation to invest in any deal.
Minimums: If you commit money to the deal and we do not raise the minimum amount (usually $100k) we will cancel the deal and refund your money. Minnow does not hold your money, it is held by AngelList until it is either wired to the company or returned to you.
SPV Setup Fee: When you invest through Minnow you are joining a one-off Special Purpose Vehicle (SPV) with other Minow members which invests directly in the company. Minnow manages the SPV on your behalf. Each SPV has a one-time setup fee of $8,000, which is split on a prorated basis across the investors in that specific deal. This fee is paid to third parties such as state regulatory agencies, payment processors, and accountants. Neither the syndicate nor AngelList profit from these fees.
Example: If the syndicate invested $500k in a startup, and you put in $50k (10% of the total), you would pay approximately $800 in costs (10% of $8,000).
Deal terms: Terms of each deal will differ. We seek pro-rata rights where possible, and will give syndicate members the option to take up their pro-rata rights in subsequent rounds. Where syndicate members can’t (or won’t) take their full pro-rata rights, syndicate leads reserve the option to fill the gap. We may do this as individuals, or through another SPV.
Carry: The syndicate will charge 20% carry. This is paid to the lead investor(s) on a deal in order to compensate them for their due diligence, negotiating with the startups, and their time advising and supporting the startup community.
Example: Suppose you invest $10,000 in a company, and there is a liquidity event that returns $100,000 in total (a ‘10x return’). Your investment made a profit of $90,000. You would receive your initial $10,000 back, plus 80% of $90,000 ($72,000), for a total of $82,000. The syndicate leads would receive the remaining 20% of the $90,000 profit ($18,000). Note that you will only ever pay carry if you make at least your initial investment back and then some.