CycleFlow Capital is an investment syndicate specializing in seed-stage investments in Web3 and DeFi startups.
Our team is responsible for the entire process, from sourcing to drafting deal memos. Our members decide if they want to invest on a case-by-case basis. Don’t like a startup? Just pass on it and await the next opportunity.
We don’t have a paid subscription or charge management fees. Instead, we utilize the typical carry model, ensuring our incentives are fully aligned with our investors. The carry is structured on a deal-by-deal basis with each deal having a separate partnership agreement.
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FAQs
What is a syndicate?
A syndicate is a group of investors who pool their capital together to invest in startups or other investment opportunities.
Who is holding the funds?
The funds are held in a Special Purpose Vehicle (SPV) structure. This SPV is established specifically for each investment opportunity and is responsible for managing the capital contributed by syndicate members. The SPV ensures proper legal and financial compliance throughout the investment process.
Who makes the buy decision?
The syndicate leads (our team) are responsible for sourcing and evaluating potential investment opportunities. However, the decision to buy shares in a startup ultimately rests with individual investors. Once a potential investment opportunity is presented to the syndicate, each investor will have the opportunity to review the provided information and decide whether to participate in the investment on a case-by-case basis.
What SPV structure do you use?
We use an Estonian limited liability company (OÜ) structure that we establish for investing in a specific asset.
Investors who are not tax residents of Estonia bear no Estonian tax obligations, with tax liabilities limited to their respective home countries.
What is the cost structure to participate?
There are no upfront costs or subscription fees to participate in the CycleFlow Capital syndicate. It is completely free to join and receive deal opportunities. Additionally, there are no management fees associated with being a syndicate member. However, the syndicate lead will receive carry on successful investments. Carry is a performance-based fee calculated as a percentage of the profits generated from successful investments, ensuring our incentives are fully aligned with our investors.
Please note that SPV structuring fees apply and are pro-rata based on the investment amount of each investor. The structuring cost is 2% of the investment amount.
Don’t I have to be an accredited/professional investor to join?
No, you do not need to be an accredited/professional investor to join and invest in startups through our syndicate. We welcome individuals and legal entities from anywhere in the world (except sanctioned and blacklisted countries).
Our investments are made within a closed network, with a maximum of 149 investors per EU Member State, and there are restrictions on the maximum amount of investments per Special Purpose Vehicle (SPV). These investments do not constitute public offerings as defined by Regulation (EU) 2017/1129 of the European Parliament and of the Council.
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