How do admin costs for syndicate SPV's work?

Admin costs cover the expenses to form and operate the SPV for its life.

They cover state registrations as well as record-keeping, tax reporting, and other administrative support for the SPV.

Admin costs are paid by the SPV when the SPV closes and invests into its target portfolio company.

Investors indirectly pay a pro rata portion of the admin costs by virtue of their interest in the SPV.

Example:

• SPV is investing into Startup A and raises $1M from investors

• $8k is paid as admin costs to cover the administration of the SPV for its life

• $992,000 will be invested into Startup A

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