How to Create Investment Pools and Pool Capital with Your Network

This article explains how Investors can create an Investment Pool to unlock better terms or meet minimum investment requirements on select investment opportunities.

What are Investment Pools? 

An Investment Pool is a powerful feature that enables investors to pool capital with friends, family, and colleagues to access better terms or meet minimums on select investment opportunities.

Not all investments will provide better terms or allow you to meet investment minimums by investing with an investment pool. Please ask us on a deal-by-deal basis if it's not clear.

How does it work?

Investors have been pooling money together for a long time; however, they've most commonly done this by creating an LLC, and then having each investor contribute as a member. Then, that LLC places investments in private deals. 

This LLC-driven approach creates an administrative burden, annual filing, and tax compliance, and lacks transparency of what exactly each member owns in the underlying investments. 

Our Investment Pools feature removes all of that headache. No need to create an LLC. Simply create an investment pool, invite other investors to join you, and start investing. Each investor can invest however they want on a deal-by-deal basis, whether it's as an individual, an entity, or using their IRA account. Everything is easily tracked, and investors have complete transparency into exactly what they own. 

Advantages of investing via an Investment Pool

✅  Meet Investment Minimums and Diversify
Investors can pool money to meet an investment minimum and invest in more deals. For example, instead of investing $100,000 in one offering, an investor could create an investment pool, invite 4 other investors, who then can all contribute $20,000 each across four offerings. Now this investment pool has allocated a total of $400,000 across four unique deals, which diversifies everyone's portfolio. 

✅  Get Better Investment Terms

Investors can access better terms in exchange for investing larger amounts as a group. This is typically available when there is an investment class for investors who meet a large minimum investment requirement in order to unlock better economic treatment.

Example: Class A might have a minimum investment of $50,000 and provide a 7% preferred return and 70/30 splits, whereas Class B has a minimum investment of $500,000 and provides an 8% preferred return and 80/20 splits. By using an investment pool, investors can pool their capital together to unlock better terms that are available to $500,000 investments.

How to Create an Investment Pool and Invite Your Network to Invest Together

Steps to Create an Investment Pool and Invite Investors:

Step 1: Navigate to Profiles > Investment Pools.
Step 2: Click "Create New Pool" and assign a descriptive name for easy identification.
Step 3: Input the email addresses of your friends and family, then click "Save & Invite".
Step 4: An invitation email will be sent to all Invited contacts to sign up and begin the investment process.

If the invited contact is new to the platform, their name will be displayed as a Pool Member once they complete the portal sign-up process.

For existing contacts already on the platform, they will be automatically added into the pool

Steps for investors to invest through an Investment Pool

The investment process remains unchanged — click here to learn more.

The only addition with the Investment Pools feature is a new dropdown menu in Step 2 of the investment process, allowing you to select the Investment Pool you're investing through.

Once the investment is made via an Investment Pool, a small Pool icon will appear next to the investor's Profile, indicating you have invested through an Investment Pool.

How Investment Pool owner can view and mange the investors of a pool

To view the members of your Investment Pool and their corresponding investments, go to the Profiles section, select Investment Pools, and then click on View.