Q: I don’t know anything about investing. Can this still work for me?
A: Yes. Our funds are designed for both those new to investing and those with deep investing experience. If you don’t have much (or any) experience, we offer you a rich educational experience. This includes real-time hands-on learning each month, as well as webinars for deeper dives into the various components of early-stage investing. You don’t have to be an angel investor to benefit from a diversified portfolio of 10+ high-potential companies.
Q: Is there an education component included with this fund?
A": Yes. Our “learn-by-investing” model lets our members learn at whatever level of engagement fits their lifestyle. The real learning comes from being a part of this totally transparent process: watching companies pitch, hearing the questions our Venture Partners drill down on, being part of the discussion as we evaluate companies post-pitch, and potentially joining a deal team to be a part of the diligence process, and joining success teams post-investment to help portfolio companies succeed. We also host safe spaces for all of your investment questions, including monthly educational sessions focused on the fundamentals of early-stage investing (e.g. Sourcing, Decision Making, Adding Value, Diversification, and Exits).
Q: I’m interested, but I don’t have much time to give to this right now. Is this something I can still do?
A: Of course. Participation is a benefit of being involved in a Portfolia fund, but it’s not necessary for you to participate actively to gain substantial value—we want Portfolia to fit your interest and lifestyle. Portfolia is a ‘guilt-free’ zone and we encourage you to engage personally at whatever level works for you.
Q: Where do you find companies to invest in?
A: We source our potential investments through Portfolia’s deep networks, our 35+ venture partners, and 1200+ members. Additionally, our deal flow comes from the deep relationships Portfolia holds within the Venture Capital community, accelerators, and others in the innovation ecosystem. Our CEO is also Founder/CEO Emeritus of the Kauffman Fellows Program, a venture capital training program with over 700 VCs around the world (40% of whom are women). We see companies not available to others.
Q: How do I submit a company for consideration?
A: In addition to our Venture Partners and deep professional networks, we source potential investments from our members. You can refer a company or instruct the CEO to submit their company here. We only consider companies that are venture-ready and meet the investment criteria set forth by each Fund. That usually means the company has a product, service, or platform already in the marketplace, has a unique competitive advantage in the marketplace, is recognizing revenue, and has an experienced leadership team. Your referrals are one of the reasons we’re so successful as a team.
Q: Can I invest more than $10,000?
A: Yes. $10,000 is the minimum investment amount. Our average investment is about $35,000 per fund and you can invest up to $500,000 as an individual. Limited number of spots for $10,000 are available per fund.
Q: Can men invest in the funds?
A: Absolutely. Portfolia funds are a new model of venture investing designed to appeal especially to women and minorities – but we’re inclusive to all and welcome men in our funds.
Q: What are the risks involved?
A: You can lose money in early-stage investing and not all companies will succeed. Our Portfolia approach balances early-stage, higher-risk companies with the potential for high rewards, with safer, later-stage companies in the same focus area. Your diversified and balanced Portfolia will consist of 10+ companies per fund. Our intent is to provide a top quartile return to our investors.
Q: What does “accredited” mean, and why do I have to be accredited to invest?
A: U.S. federal regulations require potential investors in private companies to meet certain income guidelines before they invest. These were established to ensure an individual can afford to suffer a loss of the investment without undue consequences, harkening back to the Great Depression in the 1930s. To be accredited, you must hold income of $200,000+ for the last two years and expect to have that income going forward (OR $300,000+ if including your spouse); OR net assets, minus your home, of $1 million.
Q: How do you know that I’m accredited?
A: You will have to be validated as accredited, but it’s not too onerous. With information you provide, we identify one of the following to be true to establish your accreditation status:
If you are already a member of an angel group or were referred by a member of our angel group that knows you to be accredited.
If someone in the Portfolia member organization (investment team or member) has a prior relationship with you and knows you to be accredited.
If you’re new to investing, we need to have a qualified third-party (attorney, CPA, financial advisor, or registered broker-dealer) who can speak to your income and/or assets submit a simple accreditation certification form. Please email investorrelations@portfolia.com for a copy of the form.
Q: How does early-stage investing compare to other investment options?
A: Angel investors with a portfolio of 30+investments have the greatest returns per the available data, but this number is very difficult to achieve on your own. An investor would have to review hundreds of deals and do deep research on dozens before creating a personal portfolio of 30+ companies. That’s why Portfolia uses a collaborative process, reviewing the best opportunities across the country, to provide its fund members with a quick and balanced portfolio.
Q: Do you only invest in companies led by women?
A: We invest in companies that we want in the marketplace, that have a high potential for returns, and where we can add value to the entrepreneurial team. We invest with a preference for inclusive and gender-balanced teams. Our goal, though, is always to find the best investments for our members.
Q: I am a very experienced investor. How can your model work for me?
A: Experienced investors will find the model innovative and will benefit from further diversification with a national footprint. And we’re always looking for experienced angel investors, VCs, and successful entrepreneurs as lead investors in future funds.
Q: I am interested in investing in LGBTQ+, BIPOC or other minorities. Is that a fit for Portfolia?
A: It’s probably not a surprise that we’re interested in and backing companies that are not finding an open door in traditional venture capital. Great companies are being founded by African American and Hispanic men and women, yet they are finding difficulty in getting capital; while their communities see gaps that must be filled. The same is true with the LGBTQ+ community. Portfolia aggressively seeks companies that we feel understand a large and untapped market, beyond that defined by traditional Silicon Valley or Wall Street investors. It makes sense economically and socially. Our Rising America I & II Funds are specifically investing in this space.
Q: Can I tell others about Portfolia Funds?
A: When Portfolia investors become involved in the funds, they often ask to share it with their friends and colleagues. We’re happy for you to do this. Do remember that you must be accredited to invest. Please refer those that have an interest in Portfolia Funds to investorrelations@portfolia.com.
Q: How can my organization get involved?
A: We partner with a number of organizations well aligned with Portfolia and our members. Our partnerships can include training, co-sponsoring events, education, organization-specific introductory calls, and the option to partner on individual funds. Please reach out to investorrelations@portfolia.com.
Q: Do you take institutional investors?
A: We do accept institutional investors in our funds.
Q: Do you invest in companies outside the U.S.?
A: At this time, we are only investing in companies with a registered U.S.-based C-Corp. Many companies founded in other countries register in the U.S. We do have investors from countries around the world.
Q: How many investments would the fund pursue?
A: We usually make up to 10+ investments from each fund.
Q: How does follow-on investing work with Portfolia?
A: Follow-on investing occurs when a company we have previously invested in returns for additional capital. We have assignable pro-rata rights (the right to invest at the share of the company we now own), so our individual member investors can continue to invest in the company if they choose. We invest each of our Funds within approximately 12 months, and subsequent Funds also have the opportunity to invest in our portfolio companies at later stages.
Q: What incentives do your lead investors have to bring great deals to the Fund?
A: We’ve created a new model that brings top individual investors, mostly women, into leadership roles in our funds. All of our lead investors share in the carried interest (or profits) of the fund, both as a group and individually for the companies they bring to the fund. This enables us to have a national footprint and ‘cherry-pick’ the best deals for our fund.
Additionally, all are committed to getting greater exclusivity as investors in entrepreneurial companies. They also benefit from the collaborative nature of the process, which results in seeing more and better investment opportunities as a group. Finally, as one said, ‘this is the most enjoyable investing I’ve ever done.’
Q: For tax reporting, will I get a K-1?
A: Yes, our tax accountants are familiar with the tax return processes for early-stage investments. You will receive your K-1 in March.
Q: How do I get my money back?
A: As each company is sold or goes public, we receive a return and divide it among all members within 8 weeks of our receipt. The fund has up to a 7-year life, and companies not sold at that point, will be sold on the secondary market or held for further profit.