What’s a nominee and what’s the Seedrs nominee construction?

One of the essential options of Seedrs is our nominee construction. At its easiest, ‘nominee’ is a authorized time period for an individual (or firm) that holds shares on behalf of others. At Seedrs, we maintain the shares in our portfolio firms on behalf of our buyers. This construction is utilized in personal investing to simplify the method of managing a number of buyers in a single startup.

Whereas Seedrs will probably be registered because the authorized shareholder within the firm and maintain all the executive shareholder work in your behalf, the complete financial curiosity within the shares will at all times circulate again to you. The nominee construction means our buyers obtain the professional-grade protections they deserve and entrepreneurs don’t find yourself with messy and hard-to-manage cap tables.

The investor advantages of the Seedrs nominee

(For entrepreneur advantages go right here).

1. Traders don’t want to fret concerning the administrative burden of their investments. 
2. People can purchase shares for as little as £10 as a result of investments are pooled.
3. Investor protections: we implement shareholder rights, guarantee compliance by the corporate with its subscription agreements, and usually be sure that our buyers get the perfect end result attainable from their investments. 
4. It allows our Secondary Market. Because the nominee is the authorized shareholder of all investments made by Seedrs buyers, we will allow buying and selling inside the construction by transferring useful possession between underlying buyers. The Secondary Market, powered by the nominee construction, is fixing the liquidity drawback of personal investing.
5. The platform ensures that every part the corporate shares in its pitch is ‘truthful, clear and never deceptive’ — and runs primary background checks to make sure that the founders and enterprise are above board. This ensures that the funding choice you make is well-informed. We encourage all buyers to finish their very own due diligence earlier than making any funding selections.

We have now buyers’ greatest pursuits at coronary heart

As nominee, Seedrs is mostly empowered to take selections on behalf of our buyers as an entire, and can at all times act of their greatest pursuits with the intention of (a) maximising potential returns, and (b) guaranteeing that buyers are being handled equitably. We don’t sometimes cross votes again to particular person buyers until there’s a selection that must be made by every particular person investor (e.g. exercising out there pre-emption rights).

Our Portfolio Staff

We have now a powerful (and rising!) portfolio group at Seedrs. This group spends their time coping with our portfolio of companies and appearing on behalf of our buyers. This includes serving to firms with exits, wind ups, and pre-emption rounds, imposing and defending shareholder rights, monitoring enterprise efficiency, and chasing companies to replace constantly. 

We hope that helped in outlining what the nominee is and the way it advantages you as an investor. For those who’d like extra data, you possibly can learn extra about our nominee construction from our founder Jeff Lynn, right here.

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