Investors may notice that the same routing and account number appear across multiple funds or investments in wire instructions. This uniformity stems from AngelList’s banking infrastructure, which assigns each investor entity a unique sub-account within a For Benefit Of (FBO) program managed through partner banks like Grasshopper Bank and Piermont Bank. Although these FBO accounts operate under a single omnibus account, each fund and investor sub-account has its own unique account number and distinct audit trail, ensuring clear tracking for every transaction.
- Entity-Specific Sub Accounts: Each investor’s entity (e.g., an individual or trust) has a dedicated sub-account within AngelList’s FBO program, rather than wiring directly to individual funds. This allows each entity to use consistent wire instructions across multiple investments.
- Allocation Based on Wire Memos: When funds reach the entity’s sub-account, they’re automatically directed to specific investments based on the wire memo in the capital call notice. If no memo is provided, the funds automatically go to the oldest pending investment.
- Enhanced FDIC Coverage: AngelList’s Networked Banking program utilizes sweep accounts to distribute deposits across a network of FDIC-insured banks, providing up to $125 million in aggregate coverage for eligible participants.
This structure ensures that, while wire instructions remain consistent for each investor entity, funds are securely and accurately allocated to the intended investments, maintaining both simplicity and security in the transaction process. For more information, please visit this link.