
Hey Look, Software Just Ate VC - joshuaxls
http://startupljackson.com/post/56584441451/hey-look-software-just-ate-vc
======
wikiburner
Holy shit was Syndicate good. Probably the best experience I had playing games
as a kid (and my intro to Gibson, Stephenson, and Sterling), with the possible
exception of Populous.

Bullfrog was genius.

If anyone with any say in the games industry is by chance reading this, I
would easily pay $99+ for a "Shadowrun Returns" style remake of the game,
instead of sequels to the mediocre, Syndicate in name only FPS they released
last year:

[http://www.metacritic.com/game/pc/shadowrun-
returns](http://www.metacritic.com/game/pc/shadowrun-returns)

~~~
Negitivefrags
Here is the relevant kickstarter for you:
[http://www.kickstarter.com/projects/5livesstudios/satellite-...](http://www.kickstarter.com/projects/5livesstudios/satellite-
reign)

26 hours left.

~~~
wikiburner
Wow, Ask and ye shall receive. Thanks for that.

I guess I'd be a pretty big hypocrite if I didn't kick in the $99 now.

~~~
benologist
You may also like this:
[http://www.seantcooper.com](http://www.seantcooper.com)

The guy who designed/programmed Syndicate is still making games.

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seldo
Are these syndicates only now possible because of the crowdfunding provisions
in last year's JOBS act, or is it just that nobody thought of doing things
this way before?

~~~
carlosrt
Naval probably hatched this plan when VC's screwed him in Epinions. Brilliant
payback.

In the USA one still can't crowdfund (from non-accredited investors) yet, but
in a couple of months one will be able to share with the general public that
they're fundraising.

These raises are possible because of Rule 504, 505, & 506 of the SEC.

Seed offerings:
[http://www.sec.gov/answers/rule504.htm](http://www.sec.gov/answers/rule504.htm)
Series A:
[http://www.sec.gov/answers/rule505.htm](http://www.sec.gov/answers/rule505.htm)
Series B & later:
[http://www.sec.gov/answers/rule505.htm](http://www.sec.gov/answers/rule505.htm)

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Asparagirl
So the Syndicate guys are kinda like real estate brokers, and AngelList is the
MLS?

~~~
prakster
Somewhat, but not quite...Real Estate brokers get a cash commission, not a
piece of the home value. But the analogy comparing AngelList to an MLS makes
sense.

~~~
Asparagirl
I'm not sure where you live, but in the US, the standard commission for a
registered broker selling a house is six percent of the selling price of the
house, not a flat fee. But yes, they do not get to keep that six percent in
perpetuity.

~~~
TezzellEnt
Technically it's illegal to set commission rates, but 6 percent was the norm.
In the Bay Area however, it's the new norm to offer 2.5-2.0% to Selling agents
(those bringing buyers to the deal). I'm not sure exactly what the Listing
agents put as the commission fee, but I'd imagine they're likely splitting it
50/50.

~~~
cschmidt
That wouldn't fly in Boston. I imagine the listing agent is also making 2.5%,
giving a total of 5%.

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lifeisstillgood
This simply devalues startups and re-emphasises how startups are less
disruption and much more a third way between job or student.

Only a market where a flood of new, mostly indistinguishable entrants would be
able to use an app for funding

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lucisferre
Can anyone show an example of what 20% of the carry would look like. I'm a bit
unclear how much the advisor gets here and how much AngelList is getting (and
what they are getting exactly).

~~~
pkaler
Let's say the pre-money valuation of a startup is $4m and they raise $1m. The
syndicate would own 20% of the company.

Let's say the company exits for $20m. Let's ignore preferred stock and assume
it's all common to make the math easier. The syndicate would get $4m.

The first $1m would be payed back to the entire syndicate. The lead would get
an additional 20% of the $3m or $600k. Then the rest of the $2.4m would be
split amongst the syndicate.

Read chapter 9 of Venture Deals for more detail.

~~~
beachstartup
> The first $1m would be payed back to the entire syndicate

i'm not an expert but i believe the carry is the portion above and beyond the
promised return - in this case, the syndicated invested $1m, the promised
return (let's call it 10% a year) would then be $1.1m (let's call it a year of
waiting).

wouldn't the carry (the "bonus", basically) be 20% of $2.9m?

or maybe these deals lack a promised return and define the carry as anything
beyond returned principal?

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fjordan
This FAQ may be helpful for those less familiar with investing:
[https://angel.co/help/syndicates](https://angel.co/help/syndicates)

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bencollier49
Not sure I completely understand this - what's the position in the States, can
incorporated entities advertise the sale of stock to the public?

In the UK that's basically the distinction between a limited company and
public limited company (PLC).

Gods help anyone who tried to find a way to sell stock in a limited company to
the general public. Prison would beckon, I suspect.

~~~
mdda
Actually, the UK is ahead of the US in equity (and debt) crowdfunding (the
JOBS act is moving the US to the same place gradually). See, for instance,
[http://www.seedrs.com/](http://www.seedrs.com/) (or
[http://www.growingbusiness.co.uk/crowdfunding-your-next-
sour...](http://www.growingbusiness.co.uk/crowdfunding-your-next-source-of-
capital.html) for an overview).

~~~
bencollier49
I don't get how this isn't illegal.

Limited companies are restricted from selling shares to the public. How do
they get around it?

EDIT: Scratch that, looks like the FSA green-lighted it. Wow.

