Can I transfer warehoused investments to my fund on AngelList? What is warehousing?
Warehousing involves acquiring investments personally with the intention of later transferring them to a fund that is in the process of fundraising or investing.
When does AngelList allow the transfer of warehoused investments?
AngelList supports transferring a fund manager’s warehoused investments to either a Venture Fund or Rolling Fund. For Rolling Funds, investments cannot be split across multiple quarterly funds. AngelList does not support warehousing for SPVs or off-platform funds.
Which warehoused investments can be transferred to my fund?
Generally, investments that haven’t been marked up or converted can be transferred. However, for funds relying on the venture capital fund adviser exemption, personal investments transferred to the fund must meet the 20% limit on non-qualifying investments. In certain cases, investments may be considered qualifying if they were intended for transfer at the time of purchase and were properly disclosed to fund investors. AngelList can help assess if an investment qualifies, based on the criteria below.
What qualifies as a venture-qualifying investment?
To treat warehoused investments as qualifying, they must meet the following criteria:
- The investment was made during the fundraising process for the fund to which it’s being transferred.
- The intention was always to transfer the investment to the fund, but it couldn’t be due to the fund not being legally formed or lacking sufficient funds at the time.
- The investment follows a clear, objective time and thesis-based criterion you’ve set (e.g., investments made 6 months before the fund’s first close). The SEC mandates that you must warehouse all qualifying investments based on your criterion.
- The investments were disclosed to limited partners (LPs) at the time of their subscription to the fund.
- The investments were qualifying at the time of purchase (e.g., not secondary purchases, crypto assets, or non-qualifying assets).
How does the warehousing process work?
- Submit investment information
Provide details about each investment you wish to warehouse, including purchase agreements, approval from portfolio companies for transfer, and whether you want to exchange the investment for cash or fund interest. If you need help determining if an investment qualifies, we will need your fund’s warehousing objective criterion. - Investment review & LP consent
After submission, AngelList will review the investments and may require LP consent if certain disclosures were not made. We will contact you with further instructions. - Drafting & signing agreements
Once investments are approved, AngelList will prepare a purchase agreement (for the fund’s purchase from you) and a transfer agreement (for the transfer to the fund). Both agreements will be signed digitally via DocuSign. Follow up with portfolio companies if there are delays in signing. - Payment & transfer
After agreements are signed, AngelList will add investments to your fund’s dashboard and process payment, provided there’s sufficient “Investable Now” capital. We will follow up with the portfolio company to ensure their records are updated. The payment process starts only once all agreements are signed.
How long does the process take?
- Once all required information is submitted, AngelList typically takes about 1 week to review and prepare agreements for signatures. If there are many investments or missing information, the process may take longer.
- After signing, expect 2-3 business days for approval and payment, assuming your fund has sufficient capital.
Are there additional costs for warehousing?
AngelList charges a $2,000 fee per warehoused investment to cover the management of the entire process. Additional legal costs, such as fund agreement amendments, will be charged separately.
Does AngelList support the transfer of investments purchased from other sellers?
No. AngelList can only support the transfer of investments that you, the Fund Lead, purchased personally.
What can I receive in return for warehoused assets?
AngelList can warehouse investments in exchange for cash or Fund Lead owned fund interest (in-kind contribution). LP interests are not supported.
Can I warehouse investments after fundraising?
Yes, you can warehouse investments either during or after fundraising. However, such cases will be handled individually, and these investments are likely not to be qualifying. LP consent may be required for the transfer.