Setting up deals and investments - instructions

Updated 2 months ago by Sanjay Vora

Avestor provides fund managers with significant flexibility so depending on your situation so lets go through the options.

  • Option 1 - Raising investor capital before investing in an opportunity
  • Option 2 - Using Manager capital to pre-invest in an opportunity
  • Option 3 - Using a combination of investor capital and manager capital to invest in an opportunity
Before reading these detailed instructions, you can get a high level overview on the difference between Deals and Investments in the "Deals vs Investments? Don't be confused" article in the Learning the Basics section.
Option 1 - Raising investor capital before investing in an opportunity

If your plan is to raise capital from investors first, the steps are as follows:

  1. Create a Deal - go to Investments menu and select "Create a Deal". As part of setting up the deal, you will put in a target raise amount and target closing date.
  2. Upload Deal documents - after you setup the deal, you will want to upload the documents associated with that deal - investor overview, photos, and other documents.
TIP: Remember to set one photo as a "Primary Image" - this is the photo that investors will first see
IMPORTANT: Keep images and PDF sizes small to ensure fast download speed for your investors. Target <1 MB for images and <3MB for PDFs.
  1. Gather Soft Commits - your investors can now view this deal and provide soft commits & begin the process to invest.
    1. Registered users - if a registered user has done a soft commit, they will need to complete the registration process and join your fund prior to investing.
    2. Existing fund clients - they can wire funds directly to your fund's bank account
  2. Collect electronic signatures on the Individual Deal Disclosure document from each investor that is participating in the deal.
  3. Invest as a Fund - after collecting all capital, the fund will make a single investment into the opportunity.
  4. Convert Deal to Investment - go to the Investments menu and select "Convert Deal to Investment". Set the date of the transaction and the amount the fund invested. This is now considered a fund investment.
    TIP: Remember the date that you set. You will need to use this same date when allocating investors into the investment.
  5. Allocate Slices to Investors - you must now allocate slices to each of your investors that provided capital. Go to the Operations menu and select "Allocate investment slices".
    1. Check investor cash balance to ensure sufficient funds are available
    2. Set the allocation date to the same as the date of investment. This ensure the investor gets 100% of their share of distributions, profits/losses.
    IMPORTANT: The allocation date is very important. Avestor's platform tracks both % unit ownership and % time in an investment. For equity investments, the difference between the investment start date and the allocation date for an investor determines how distributions, profits/losses, income are split between the Manager and the Member. Ensure that date that you allocate the investor into the investment is the correct date that their investment started. This cannot be adjusted later and will flow through all accounting and tax calculations for the life of the investment.
    1. Allocate the investor into the investment
    2. Repeat above steps for each investor. When completed, all slices of the investment should have been allocated to investors.
Option 2 - Using Manager capital to pre-invest in an opportunity

If your plan is to plan to pre-invest in the deal and then allocate investors into the deal, the steps are as follows:

  1. Invest in the deal using fund capital
  2. Create an Investment - go to Investments menu and select "Create an Investment".
  3. Upload investment documents - after you setup the investment, you will want to upload the documents associated with that investment - investor overview, photos, and other documents.
  4. Gather investment requests & wait for investor capital to arrive into the fund bank account.
  5. Collect electronic signatures on the Individual Deal Disclosure document from each investor that is participating in the investment.
  6. Allocate slices to investors as their capital comes into the fund - you can allocate slices to each of your investors that provided capital. Go to the Operations menu and select "Allocate investment slices".
    1. Check investor cash balance to ensure sufficient funds are available
    2. Set the allocation date to the date that the investor capital arrived or the date the investor requested to be allocated into the investment if capital was already in their account.
    3. Allocate the investor into the investment
IMPORTANT: The allocation date is very important. Avestor's platform tracks both % unit ownership and % time in an investment. For equity investments, the difference between the investment start date and the allocation date for an investor determines how distributions, profits/losses, income are split between the Manager and the Member. Ensure that date that you allocate the investor into the investment is the correct date that their investment started. This cannot be adjusted later and will flow through all accounting and tax calculations for the life of the investment.

Option 3 - Using a combination of investor capital and manager capital to invest in an opportunity

If your plan is to invest with a combination of Manager capital and investor capital, the steps are as follows:

  1. Follow Steps 1 to 3 of Option 1
  2. After gathering soft commits, decide how much additional Manager capital will be invested
  3. Invest as a fund using both the investor capital and Manager Capital
  4. Convert Deal to Investment
  5. Collect electronic signatures on the Individual Deal Disclosure document from each investor that is participating in the investment.
  6. Allocate slices to investors that provided the capital. The remaining slices will be in the Manager account.
  7. The Manager slices can then be allocated at a later date as additional capital comes in


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