I started angel investing in 2004 in the Los Angeles ecosystem. My first checks were small — tiny, really — but I always invested my time and network alongside my capital. That combination earned me the reputation as a “go-to” angel, and soon, I started seeing more and more deal flow. I shared those deals with other investors and built a list of 100+ angels who liked seeing what I’d found and would frequently “follow” me into a deal.
Just like most startups, most of my angel investments failed. But others were companies you might know: LinkedIn, Pandora, Ustream, Scopely, SpaceX. Those wins accelerated the flywheel: successful founders, successful investments, more angels, more wins, and ever-increasing deal flow.
Angel investing was (and still is) a very tight-knit club. You had to know the right people. If you weren’t connected, you were locked out of the best opportunities.
The Game Changed in 2012
Federal regulations finally allowed founders to publicly share investment opportunities with all accredited investors. Naval Ravikant launched AngelList, making it simple for groups of angels to pool many small checks into Special Purpose Vehicles (SPVs) and jointly invest in individual deals. The “syndicate” became a certified investment vehicle, and angel investing became available to many.
In 2014, I co-founded Moonshots Capital with Craig Cummings, my business partner and fellow West Point graduate, to run more syndicates, more efficiently. The rest is history: we’ve now deployed over $65 million through syndicates into 40 companies. Even with three venture funds raised, syndicate deals remain a substantial pillar of our strategy.
Why Syndicates Matter
- Good for lead investors! As the lead angel investor in a syndicate, I source the deal, secure the allocation, conduct due diligence, create a data room for my follow-on investors, legally form the syndicate and paper up the members, remain the main point of contact, and manage distributions on exit. For leading all that work, I can charge fees and carry; before, all that was gratis.
- Good for following investors! Syndicates democratize the investment landscape. You shouldn’t need millions in your bank account for a piece of the next LinkedIn, Pandora, Scopely, or SpaceX. Our committed venture fund’s minimum is $250,000. Syndicate minimum? $5,000. That difference opens doors for many.
- Good for founders! Instead of managing a cap table with 50+ angels, founders now have one point of contact. Syndicates pool limited capital into a check large enough for billion-dollar rounds, how our syndicate investors got into Slack, Robinhood, and xAI at multi-billion-dollar valuations.
We keep running syndicates because they benefit all players in the ecosystem.
How Venture Funds and Syndicates Actually Work
Craig and I say investing in a venture fund is like a marriage. Commit capital to a VC fund, and we deploy it across 15–20 companies over 3–5 years, then spend another 6–7 years helping our portfolio companies get to exit for M&A, or 7–10 years helping them reach IPO. You’re along for the entire ride: the wins, losses, everything.
Throughout this time, your capital is managed professionally. You remain hands-off while we make investment decisions and do the heavy lifting. Diversification mitigates risk, and if you’ve picked a fund with experienced GPs, your odds for solid returns improve.
But fund investing frequently sits behind high barriers: the SEC requires “qualified purchaser” status, $5M+ in investable assets. Even with $250K on hand, without meeting the mandated thresholds, you won’t have access.
Syndicates flip the script. Each deal stands alone, and you call the shots. We vet opportunities, we invest, and we recommend to our syndicate community, but you decide whether to invest $5K, $50K, or pass entirely. No long-term commitment.
Syndicates aren’t universally available, but the SEC and many syndicates set the bar lower: “accredited investor” status requires $200K annual income ($300K with spouse) and a $1M net worth, excluding your home. These requirements protect people from taking risks they can’t afford; startups are risky, and most will fail. But if you qualify, syndicates give you access to vetted deals once locked away for elite networks.
Accessing Syndicate Deals
Most venture firms operate in silos; you’re in, or you’re not. Syndicates offer flexibility. Funds typically focus on early-stage checks, like Moonshots Capital’s focus on Series Seed, where board seats and hands-on support matter. But when startups raise Series B or beyond, traditional early fund investors get diluted and/or miss out.
Syndicates solve this. When our portfolio raises a follow-on round, we can organize syndicates for both fund LPs and external investors. That way, new investors can join successful companies even if they weren’t in the fund, and we enable our LPs to keep backing founders they believe in.
We also use syndicates for late stage deals outside our fund’s scope. Thanks to our strong networks, Craig and I often get allocations in blockbuster companies like Slack or xAI at, sometimes, multi-billion valuations; too big and too fast for our funds. Syndicates let us aggregate capital quickly and participate when we get allocation.
Access priority is clear: fund LPs see opportunities first, for both follow-ons and new syndicate deals. Any remaining capacity goes to our broader syndicate community; any accredited investor can sign up.
This structure benefits everyone: fund investors get additional chances to support winners, syndicate investors access vetted deals across stages, and companies obtain capital from engaged investors who understand their business.
Risk & Diversification: The Trade-Offs
Venture funds spread your risk automatically. By investing across 15–20 companies, half can fail, but the winners can still deliver strong returns and carry the fund. Portfolio construction? That’s our job.
With syndicates, each deal is a unique decision. This is where most angel investors get it wrong.
My late mentor, Luis Villalobos, often ran simulations: to capture the returns of the early-stage tech asset class, you need 20–25 investments. Venture math is unforgiving. In our funds, 70% of companies return less than our investment, 20% return 3–10x, and the top 10% drive most returns. One big win makes the portfolio, but you need enough shots to find that win. This is the power of diversification.
With professional syndicate leads, you can probably plan for 20–25 companies and still hope for above-average outcomes. Find your “unit bet” and stick to it. At $5K per company, plan on $100K to hit the 20-company threshold. Don’t make the common mistake of writing just 3–4 big checks, they often have a poor outcome and little diversification.
Diversify over time, aiming for those 20–25 investments over 4–7 years to manage cash flow and de-risk from market swings. Maintain patience: think in 8–12-year timeframes for returns if you are investing in early-stage deals.
Some investors diversify with multiple syndicate platforms, others combine syndicate deals with fund commitments, and some make concentrated bets on companies they know well.
Either approach can work — just be sure your risk profile fits your goals.
Fees, Value, and the Fine Print
Fund investors pay 2–2.5% annual management plus 20% of profits (“carry”), regardless of outcome, but gain professional management, board representation, and our full-time involvement.
Syndicate fees vary, often 1–2% annually plus carry on exits. You get deal sourcing, diligence, and ongoing support, without the overhead of a full fund.
Fund portfolio companies get our undivided attention: board seats, hands-on support, and quarterly investor updates.
Syndicate deals vary. Follow-on rounds in our fund portfolio (unicorns like ID.me, Cart.com) benefit from our extensive involvement and operational support. Other syndicates get ad-hoc help. For major external rounds (e.g. xAI, Robinhood, GrubMarket), we’re hands-off, but you can trust those leaders to execute.
Both require SEC compliance: accredited investor or qualified purchaser verification. We handle the paperwork, but you can sometimes expect background checks on finances.
Consult an experienced tax professional: investment decisions have lasting impact.
The Leadership Lens: Our Approach to Fund and Syndicate Deals
Craig and I have been investing together for two decades, driven by a core belief: extraordinary leadership determines success. This principle guides both our fund and syndicate investments.
Take Blake Hall at ID.me. I wrote one of his first angel checks in 2010; Craig and I participated in every subsequent round as angels, through syndicates, and through our Funds 2 and 3. Last month (15 years later), we organized a syndicate for ID.me’s $340M Series E, $2B+ valuation. Blake’s leadership, forged in the U.S. Army, took the company from a niche “Craigslist for the military,” to a national digital identity giant. Our close relationship gave syndicate backers access to this exclusive growth round.
Kelly and Craig with Blake Hall, CEO & Co-founder of ID.me
At Cart.com, we joined Series A from our Fund 2 and leaned in to help them scale. When they needed growth capital, we organized a syndicate. Same for Red 6 and Wildfire Systems — Fund 1 portfolio companies we expect to succeed.
Syndicates also let us back leaders building outside our fund criteria — xAI (Elon’s AI play) Gallatin (AI for military logistics), Apptronik (humanoid robots) — whose valuations, capital requirements and timelines didn’t fit our fund. Syndicates gave us flexibility to participate regardless.
It’s a virtuous cycle: fund investments build deep relationships with extraordinary leaders, which generate syndicate opportunities that extend that access and capture opportunities beyond fund scope.
The syndicate model will keep evolving as private market investing grows and regulatory frameworks adapt. Whether syndicates or funds are better depends on your financial circumstances and desire to pick each investment, but both offer powerful access to private opportunities once reserved for institutions.
If you choose Moonshots Capital, you’re backing the kind of leadership that’s delivered 30 exits and 18 unicorns across 128 investments — syndicate or fund, the bar is the same.
The Two Types of Syndicates We Run
- Follow-on for Fund Winners:
We use syndicates to continue backing our breakout early-stage companies when their rounds grow beyond the capacity or concentration limits of a Moonshots fund. LPs can double down on winners they know and trust, with continuity of diligence, oversight, and access. We secure allocation, share the updated thesis and data room, and give LPs the option to lean in where conviction is strongest. - Access to Late-Stage, Hard-to-Enter Rounds:
We also run syndicates into later-stage, high-demand companies closer to liquidity. Our reputation earns scarce allocation in elite companies; these rounds often have a shorter time-to-liquidity profile, which many LPs prefer for balance. We aggregate checks through an SPV, streamline cap table impact, and open exposure to coveted rounds.
Why Our LPs Like Both
- Complementary exposure: Follow-on syndicates let LPs press their advantage in known winners; late-stage deals provide access and nearer-term outcomes.
- Choice and calibration: LPs can size per deal to match their risk/return and liquidity preferences without waiting for the next commingled fund.
- Same leadership edge: Whether early or late, LPs benefit from our sourcing, diligence, founder relationships, and disciplined allocation.
Why We’ll Keep Running Syndicates
Looking back — from tiny angel checks in Los Angeles, to LinkedIn, Pandora, Ustream, and Scopely, to leading over 50 syndicates totaling $65 million — I’m reminded that syndicates changed the game for founders, investors, and lead angels alike.
That’s why we’ll keep running them. To double down on our winners. To open doors to elite late-stage opportunities. And because extraordinary leadership prevails — every time.
Join the Moonshots Syndicate List
Since 2014, Moonshots Capital has run investment syndicates (SPVs) backing over 40 companies, including Apptronik, xAI, Slack (NYSE: WORK), ID.me, Bitium (acq. by GOOG), Red 6, GrubMarket, Cart.com, FitMob (acq. by ClassPass), Harvest.AI (acq. by AMZN), Wonder (acq. by ATARI), MindStudio (f.k.a. GoMeta), Mica, Pray, PlushCare (acq. by Accolade), ProducePay, PreFix, Robinhood, Edbacker (acq. by LivingTree), Carta, and Pacaso. If you are interested in investing in our syndicates, please sign up through the link below. Our Fund Limited Partners get the first look at syndicate deal allocations.
