Pre-IPO Profits

Rolling Funds Transforming AngelList

Rolling Funds Transforming AngelList
By Adam Sharp
Date December 15, 2020

Rolling funds on AngelList are continuing to pick up steam. And I’ve been thinking about what the long-term impact of these funds could be for a while now. 

I believe that — like I said back in September — a lot of founders will switch over to the rolling fund model and largely abandon AngelList’s traditional syndicate model. And as a result, many lead investors will no longer offer investors the chance to pick and choose which deals they want to invest in.

For now there are still plenty of individual syndicate deals to invest in on AngelList. But I do believe that more and more lead investors will switch over to rolling funds — because in many ways, it is a superior model. Money is raised quarterly. Each individual deal doesn’t require its own fund to be set up. And rolling funds are more flexible, allowing investors to move faster and probably get into more and higher quality deals.

The implications here aren’t bad — it’s just going to be different. I’ve been thinking long and hard about which investors’ rolling funds I would want to back. It requires a larger investment up front, making it a big decision. But it will also provide greater diversification — and possibly better returns (if you back the right funds, of course). 

I’ll be following this story closely. And I will update you all as I learn more. 

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