Plum Alley establishes a legal entity called a "special purpose vehicle or SPV" and investors then invest in this entity. This entity then invests into the target opportunity. The investors own the entity on a pro-rata basis based on how much they invested. This approach allows for the money to be pooled and only one name on the company's capitalization table. The syndicate SPV is managed by PAVC as the investment manager.
We have an investment committee which reviews investment opportunities that meet our criteria. We consider hundreds of opportunities and select a small number with high potential. We have a due diligence framework that we use which combines many factors, including: financial metrics, financial risk assessment, operational efficiency, product market fit, pipeline, go-to market and growth strategy, pricing framework, founder experience, funding risks, client interviews, market analysis, return potential, Intellectual Property and more. Our investment committee reviews and discusses the opportunities before we bring them forward to our membership. Investing members must meet the legal qualification of an accredited investor which is further described herein.
We offer our members a moderated session with the founder(s) of the company, and as needed with the lead investors or a domain expert. Our internal team prepares an investment memo that presents key points for you to consider before choosing to invest or not. The company in review shares items like their investor deck, projections, data room, etc. Plum Alley does not independently verify information provided by the company and the information provided may or may not have everything an investor wants to make their investment decision. Be advised that the information available for early stage companies varies from company to company. There are generally three buckets of information, which are: 1. what you know today; 2. what you can find out from research and diligence; and 3. what is impossible to know today and where an investor has to make a leap of faith. An example of this would be if a new drug will or will not cure the disease it is intended for. The process of investing in an early stage company is risky because many aspects are not certain. Investors in venture companies weigh the potential upside against the risk inherent in the opportunity.
No, Plum Alley Alley does not serve as your advisor. While Plum Alley (and the company) provide information, we do not make recommendations for you and we are not your financial advisor or investment advisor. We recommend you consult with your personal advisors, as appropriate. Importantly, early stage investing is in companies that are new and their product, pricing and more are not fully developed. Investors should be aware that early stage companies never have a straight path and could fail. Investors have the potential to lose their money and/or get a tax loss.
No, there is no requirement that you invest. Most members do however.
Our investment thesis is clear and you can see from our historical investments examples of companies that meet this thesis. We look for frontier technologies and medical breakthroughs because we believe those sectors will have the most significant influence on our lives, industries and the planet and represent high potential for outsized returns. We believe that founding teams are critical and there is untapped talent in women founders from all backgrounds and categories. We believe gender diversity and diversity of thought makes for optimal decision making and outcomes. As for the stage of the company, we typically invest at the Series A level and later when the company has customer(s) and revenues. For drug discovery companies we invest when there is sufficient traction and potential, or with a platform approach when the discovery can be used for multiple disease or health benefits.
How do I certify I am an Accredited Investor? Please review the appended link from the SEC that defines an accredited investor for the purposes of this investment: SEC Accredited Investor Members attest to their status when they sign the subscription document / investor packet.
The minimum syndicate amount for each company is indicated at the beginning of the investment process. It may differ depending upon, among other factors, the size of the syndicate and the stage of the capital raise. Individual investor amounts range from $25k to $500k, with the amount entirely your choice. Many members invest in more than one company for diversification.
Plum Alley offers investors high quality venture investments. We charge a membership fee which ranges from $2,500. and up depending on the amount you invest. Membership gives you the benefits to see all the opportunities we bring forward (generally five or more per year). As a member, you can listen in and participate in our moderated founder calls and you are invited to our in-person and on-line events that cover relevant venture investing topics on new technologies, industry trends and insights. We periodically invite members to site visits or special sessions on location to see companies and technologies. You can expect to receive communications from Plum Alley several times each month.
Early stage investing is risky and as discussed herein and our companies often have inventions that have just reached commercialization. It is too early and impossible to know everything that may happen as the product enters the market or is modified for other use cases. Venture investors generally expect that in a portfolio of 10 investments, less than a third will deliver the results for the whole portfolio, one third of the companies will close and the balance will break even on the investment. Seasoned venture investors expect some of their companies to close and factor in a tax loss to offset gains elsewhere. On a portfolio approach, historically venture has outperformed other asset classes. Cambridge associates VC Index There are variations depending on sector, stage and size of portfolio.
Early stage companies need sufficient time to mature. Most venture backed companies need 7-10 years to hit their stride and find an attractive exit option. Some companies take even longer so investors should think of early stage investments as a hold for an intermediate term vs an investment that can be bought and sold in a public market on a fluid basis.
Early stage investors should expect to hold their investment until an exit by the company is achieved, which can be many 7-10 years, or in some cases longer. While there is some secondary market activity, investors can not count on a market to purchase their holdings and, if there is any activity, it may not be at an attractive or market price.
Yes, as the investment manager to the syndicates, we engage a tax firm to file taxes and distribute the K1s to the investors.
Plum Alley charges the actual expenses it incurs to cover the formation of the syndicate, annual reporting, tax filing, fund administration cost, software costs, professional time monitoring and overseeing the investments, etc. This amount allocated to each investor is dependent on the size of the syndicate and number of investors. Expense information is included in the legal documents for each syndicate. Changes in expense amount and type are made by Plum Alley from time to time based on inflation, increase in fees from outside parties and other relevant factors. The expenses of each syndicate are provided in the financial statements for the syndicate.
We encourage each member to utilize the insights and events made available by Plum Alley. Plum Alley sends out a monthly communication and other communications as needed when investment opportunities are live. Each investment opportunity is announced and members will get a calendar invite to founder calls, events, etc. Other member outreach to founders and companies should be cleared first with Plum Alley per our understanding with founders who are very busy.
Yes, if the companies meet the criteria which is outlined in the investment thesis section. We look for frontier technologies and medical breakthroughs because we believe those will have the most significant influence on our lives, industries and the planet. We believe those opportunities represent high potential for outsized returns. We believe that founding teams are critical and there is untapped talent in women founders from all backgrounds and categories. We believe gender diversity and diversity of thought makes for optimal decision making and outcomes. We typically invest at the Series A level and beyond when the company has a customer(s) and revenues. For drug discovery companies we invest when there is sufficient traction and potential, or with a platform approach when the discovery can be used for multiple disease or health benefits.
Carta is the fund administrator for all Plum Alley investments. Carta is a leading provider of fund administration services to the venture capital industry. Carta serves more than 5000 venture firms with $126bn in assets and serves over 180,000 LPs. click here to see Carta's website.Each investor has their own individual login and password to Carta. Within Carta they will find all details regarding their investment, format and investment documents and financials and other relevant reports. The data is updated regularly and the investors are encouraged to use Carta as their first port of call for all their investment related questions.
Syndicate financials will be made available annually on Carta. When formal updates are available from the underlying company, they will be made available through Carta. Other company updates will be shared through our monthly newsletter. Note that Plum Alley is not the largest investor in the companies, and therefore, we do not hold a Board seat or have information rights in all cases. We do request information rights at closing and have been granted them in many cases. The type, quantity and financial updates vary from company to company. We do our best, but it is an imperfect situation for us and the industry as a whole.
Please contact Liz@plumalley.co or info@Plumalley.co.
If you are no longer a member, you will be able to access your investment on the Carta site with your login credentials.
Please contact Liz@plumalley.co We can not cancel your membership mid-cycle. Membership can be put on hold or cancelled on your anniversary date.
Plum Alley only collects information required to comply with regulations and what is necessary to initiate, manage and complete the investment process. Plum Alley complies with all necessary regulations and all member and investor information is tagged as CONFIDENTIAL and treated as such. The treatment of such information is made in line with the market standard data privacy policy.
$22.4M was raised in total from LPs and the fund raise closed in December of 2022.
The Fund investment thesis is the same as the thesis for membership syndicates. Founding teams are critical and there is untapped talent in women founders from all backgrounds and categories. Gender diversity and diversity of thought provides for optimal decision making and outcomes. The Fund investments are at the Series A level and B level (CHECK) when the company has customer(s) and revenues. For drug discovery companies, the Fund focused on companies with a clear strategy for regulatory approval or with a platform approach when the discovery can be used for multiple disease or health benefits.
14 companies The Plum Alley syndicates were the main source of deal flow for this fund. In some cases, the Fund invested in a new company and member investors invested alongside or after the Fund. This created a win-win situation for both the syndicates and Fund with more capital deployed and more leverage.
During investment period as needed and after the investment period, annually for fees and expenses. Notice is sent to LPs ___ days in advance of capital call due date by Carta.
Carta is the fund administrator for all Plum Alley investments. Carta is a leading provider of fund administration services to the venture capital industry. Carta serves more than 5000 venture firms with $126bn in assets and serves over 180,000 LPs. click here to see Carta's web site: Carta. Each investor has their own individual login and password to Carta. Within Carta they will find all details regarding their investment, format and investment documents and financials and other relevant reports. The data is updated regularly and the investors are encouraged to use Carta as their first port of call for all their investment related questions.
Carta performs certain functions including sending out the K1s each year, issuing capital calls when necessary and making return distributions.
Yes, the Fund financials are audited and distributed to investors once approved and filed. The Fund financials also provide a schedule of investments that detail each investment the fund has made, its cost and current value. In Carta, LPs can also access the documents related to your investment. Carta is a great tool made available by Plum Alley to each investor. Investors are strongly encouraged to log-in to Carta often to keep updated on their investment and as a first port of call for questions..
Venture fund investments are considered to be illiquid and investors should expect to hold their LP investment until the Fund matures.
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