What is a warehoused investment?
There are many questions surrounding these, but what are warehoused investments specifically? What is the definition?
A warehoused investment is an investment a (prospective) fund manager makes personally (or via a wholly owned entity) before the venture capital fund is set up and reaches a first close. Shortly after reaching a first close, the warehoused investments are then transferred into the fund. Planned investments do not count as warehoused investments.
Warehoused investments are required to be disclosed to LPs before closing - this is typically done by listing them on the schedule of warehoused investments. The information required includes but is not limited to:
Warehoused investments are required to be disclosed to LPs before closing - this is typically done by listing them on the schedule of warehoused investments. The information required includes but is not limited to:
- Company name;
- Number and type of shares (if equity);
- Amount of money paid, and currency used;
- Potential conflicts of interest.
Be sure to provide fully executed copies of your warehoused investments' legal agreements to your law firm or Decile Partners (if working with Decile Launch).
Decile Base AI says we can name the potential investments for the fund as "Pipeline deals." Is that correct?
Potential investments should be referred to as Pipeline Investments rather then Warehouse investments.