What sets SeedBlink apart is its unique investment structure, for realizing the investment we have either a Special Purpose Vehicles (SPVs) which is incorporated once the round raised is over or Trust set in Austria for the most of our rounds.
Investments done using the Trust
SeedBlink uses Trust structure to realize the investment. In this setup, SeedBlink Trust GmbH Is the trustee owning the investment from a legal perspective, while the investors are the beneficial owner.
The process of realizing the investment using SeedBlink Trust goes as follows:
- Investor chooses the project: Using the platform each investor chooses the project to invest and further to confirm the investment will sign a facilitation agreement.
- Transfer of Investment: Once the round is succesful,l meaning it reached the minimum target amount, the investors will be instructed to transfer the funds into a dedicated bank account. For each project SeedBlink Trust opens a dedicated bank account.
- Signing the investment documents: Once all the investments are transferred, SeedBlink will review the investment documents to check that the TermSheet and initial terms are comprised. Once the documents are finalized, they will be signed by SeedBlink Trust GmbH on behalf of the confirmed investors.
- Ownership of Trust: Investors are the beneficial owners of the shares held by SeedBlink Trust GmbH on their behalf in the invested project.
- Continuous support: Once the investment is completed, SeedBlink will stay in touch with the startups to inform investors about the startup's performance on a regular basis, as well as to support future investment rounds for both investors and the startup by ensuring a setup for the investors' rights, such as pre-emptive rights.
- Returns Management: SeedBlink takes care of managing returns, ensuring they are appropriately distributed to investors.
Benefits of Trust-based Rounds:
- Transparency: SeedBlink provides regular updates. on the invested company's progress, keeping investors well-informed.
- Confidentiality: Each investors’ identity and investments are not disclosed.
- Simplicity: Investors are spared the complexities of managing legal entities like SPVs.
- Professional Management: SeedBlink's expertise ensures efficient handling of investments and returns.
To invest through SeedBlink, first register an account on the platform, then browse the available opportunities, select the round of interest, invest, and track your portfolio through the platform. Before investing, do your own due dilligence, assess your risk tolerance, and get advice from financial professionals if necessary.
Special Purpose Vehicles (SPVs)
In the context of SeedBlink, Special Purpose Vehicles, or SPVs, also play a crucial role in the investment process. When you choose to invest through an SPV, SeedBlink creates a dedicated legal entity specifically for the startup you're interested in supporting. Here's how it works:
- SPV Formation: For each project a dedicated SPV will be incorporated, and the investors become shareholders of this SPV. Thus, once the round is overt the Articles of Incorporation will be drafted and sent for signature to all confirmed investors. In this document all the investors will be stated, and the structure will be defined according to the amounts invested..
- Transfer of the Investment: The investment along with the additional costs will be transferred to the account of the SPV, as a contribution to the share capital.
- Signing the investment documents: The investment documents will be signed by the SPV’s Director and the startup, but only after the shareholders sign and approve the investment through a General Meeting of Shareholders. The SPV then invests the pooled funds in the chosen startup.
- Ownership via SPV: As an investor, you hold shares in the SPV, and the SPV holds shares in the startup. The investors are indirect owners ofshares in the startup.
- Returns and Dividends: Any returns, dividends, or profits generated by the startup are distributed to investors through the SPV. The distribution of any funds will be priorly agreed upon by the majority within a General Meeting of Shareholders. The distribution is made according to the percentage owned by each shareholder.
Benefits of SPV Rounds:
- Control: The investors as shareholders are in control of the SPV, each decision is taken by majority.
- Exit Opportunities: Owning shares in the SPV allows the investors to trade them no matter the type of the investment instrument (equity, CLA, SAFE, etc)
Click here for more details on the investment process for these types of Rounds.