Frequently asked questions and

glossary of terms

FAQ's

What is SVLA?


SV Links Angels is the investment arm of SV Links programs. SV Links is a non-profit organization that connects entrepreneurs from around the world to Silicon Valley. We provide exclusive investment opportunities in technology startups in the innovation capital of the world.




What is the duration of the investment?


The documents stipulate 10 years as a limit. In past investments, our experience has been: the investment in Loki Studios recovered and returned in 12 months, although this is exceptional. In other investments in which people from our network participated, returns have been recovered in a time frame of about 3-5 years, when there have been returns.




What are the criteria followed by SV Links Angels when investing?


● The person. His career, experience, professional and moral reputation, his network, skills and technical knowledge. Fortunately, being in Silicon Valley allows us to know first-hand
entrepeneurs work and fulfill the skills and potential we seek.

● The market. Sectors that are growing, markets that are at least $1 billion dollars and that the entrepreneur has a clear strategy to penetrate the niche he wants to access from that market. ● The product. It needs to be easily adjustable to what the market demands, and the
entrepreneur has the ability to adapt it quickly.




What is the minimum investment amount?


Since the management fee is the same regardless of the amount invested, it is recommended to invest an amount greater than $10,000 USD. In SV Links Angels we seek that for each investment opportunity at least $375,000 USD is raised among the entire group.




Does my investment go directly to the startup?


No, SV Links Angels creates an SPV (Special Purpose Vehicle) in the State of Delaware that functions as a company or trust that collects contributions from a group of investors. This common fund is the one that invests in the startup.




How is the money transfer done?


The investor transfers the money to a bank account in the United States by wire transfer through his or her local bank.





What is the management fee?


Each investment by SV Links Angels involves the creation of a new "LLC" type company. We'll need to keep it operating during the investment. This new entity is the one that will invest in the company. In addition to that, the review of the legal documents by the lawyer to set up the entity. This cost can represent up to 20% of the investment if the company does not have an exit before 10 years. The 10 year management fee is withheld from each investor's contribution to guarantee the operation of the investment.




What is the agreement between investors and managing partners?


The investor is called LP (Limited Partner). The managers of the investment are the MP
(Managing Partners). In this industry the standards are that of each investment, 80%
goes to the investors and 20% to the managers.




What is a term sheet?


It is a document that specifies the basic information of the investment, such as the
amounts, valuation of the company, share prices, conditions, terms and discounts of
the investment. It is not a legal document; however, it contains the required
information for the lawyers to prepare the proper documentation.




What is the contract that the company delivers for the investment?


● It can be a convertible note, where a cap is established for the valuation of the company, as well as a discount on its valuation and an interest rate associated with the period of the
note before they become preferred stock.

● It can also be a SAFE (Simple Agreement for Future Equity). An agreement that happens between a company and an investor, which the investor issues capital and the company issue a stock in return with no interest unlike convertible notes.
● The instrument will totally depend on the company raising the funds. It can either be a
convertible note, or a SAFE (simple agreement for future equity). Both of them will be
made through an SPV (special purpose vehicle), where SV Links creates an entity and
that entity invests in the final company.




Do I have to declare my investment in the United States?


An investor should declare his investment in the United States only if he has tax residency in this country. Otherwise, there is no need to make a declaration of such investment.




Do I have to pay taxes if I get a return on my investment?


Yes, the investor must pay taxes in his or her country of tax residence. Each country has its own agreements before the law for tax collection.





What is the management fee?


Each investment by SV Links Angels involves the creation of a new "LLC" type company. We'll need to keep it operating during the investment. This new entity is the one that will invest in the company. In addition to that, the review of the legal documents by the lawyer to set up the entity. This cost can represent up to 20% of the investment if the company does not have an exit before 10 years. The 10 year management fee is withheld from each investor's contribution to guarantee the operation of the investment.




What is the agreement between investors and managing partners?


The investor is called LP (Limited Partner). The managers of the investment are the MP
(Managing Partners). In this industry the standards are that of each investment, 80%
goes to the investors and 20% to the managers.




What is a term sheet?


It is a document that specifies the basic information of the investment, such as the
amounts, valuation of the company, share prices, conditions, terms and discounts of
the investment. It is not a legal document; however, it contains the required
information for the lawyers to prepare the proper documentation.




What is the contract that the company delivers for the investment?


● It can be a convertible note, where a cap is established for the valuation of the company, as well as a discount on its valuation and an interest rate associated with the period of the
note before they become preferred stock.

● It can also be a SAFE (Simple Agreement for Future Equity). An agreement that happens between a company and an investor, which the investor issues capital and the company issue a stock in return with no interest unlike convertible notes.
● The instrument will totally depend on the company raising the funds. It can either be a
convertible note, or a SAFE (simple agreement for future equity). Both of them will be
made through an SPV (special purpose vehicle), where SV Links creates an entity and
that entity invests in the final company.




Do I have to declare my investment in the United States?


An investor should declare his investment in the United States only if he has tax residency in this country. Otherwise, there is no need to make a declaration of such investment.




Do I have to pay taxes if I get a return on my investment?


Yes, the investor must pay taxes in his or her country of tax residence. Each country has its own agreements before the law for tax collection.





Angel Investors


An angel investor is a high net worth individual who provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company.




App


A software application that is designed to be downloaded into a mobile device and be
used by customers or businesses.




Carry


The percentage that Venture Capital funds will take on the extra returns in a company.
The industry standard is 20%.




Convertible notes


A short-term debt that can be converted into equity in the future, it includes interest.




Common stock


A security that represents ownership in a corporation. Holders of common stock elect the board of directors and vote on corporate policies.




Crowdfunding


Raising money from a large number of people asking them for small amounts of money to fund a project or a business.




Demo Day


An event that is organized by incubators, accelerators, or founders where they can
pitch their business project in a room full of investors.




Dilution


The decrease in the shareholder’s ownership in a company when raising new funds.




Seed capital


It refers to the type of financing used in the formation of a startup. Funding is provided by private investors—usually in exchange for an equity stake in the company or for a share in the profits of a product.




Fundraising


The process of generating money from investors in order to build a business.




General Partner (GP) and Managing Partner (MP)


A general partner is an owner of a partnership who has unlimited liability. A general partner is also usually a managing partner and active in the day-to-day operations of the business. A managing partner is roughly equivalent to a chief executive officer of a corporation in terms of duties and responsibilities, but in a partnership or small firm and not a corporation.





Glossary

Angel Investors


An angel investor is a high net worth individual who provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company.




App


A software application that is designed to be downloaded into a mobile device and be
used by customers or businesses.




Carry


The percentage that Venture Capital funds will take on the extra returns in a company.
The industry standard is 20%.




Convertible notes


A short-term debt that can be converted into equity in the future, it includes interest.




Common stock


A security that represents ownership in a corporation. Holders of common stock elect the board of directors and vote on corporate policies.




Crowdfunding


Raising money from a large number of people asking them for small amounts of money to fund a project or a business.




Demo Day


An event that is organized by incubators, accelerators, or founders where they can
pitch their business project in a room full of investors.




Dilution


The decrease in the shareholder’s ownership in a company when raising new funds.




Seed capital


It refers to the type of financing used in the formation of a startup. Funding is provided by private investors—usually in exchange for an equity stake in the company or for a share in the profits of a product.




Fundraising


The process of generating money from investors in order to build a business.




General Partner (GP) and Managing Partner (MP)


A general partner is an owner of a partnership who has unlimited liability. A general partner is also usually a managing partner and active in the day-to-day operations of the business. A managing partner is roughly equivalent to a chief executive officer of a corporation in terms of duties and responsibilities, but in a partnership or small firm and not a corporation.





Angel Investor


Un inversionista ángel es un individuo con alta capacidad de inversión que proporciona financiamiento a startups, a cambio de un porcentaje de participación de la empresa.




App


Una aplicación de software que está diseñada para ser descargada en un dispositivo móvil y ser utilizado por los clientes o las empresas.




Carry


El porcentaje que los fondos de capital de riesgo tomarán de los retornos extras en una compañía. El estándar de la industria es el 20%.




Convertible notes


Deuda a corto plazo que puede ser convertida en capital en el futuro.




Common stock


Título que otorga propiedad en una empresa. Los titulares de acciones ordinarias seleccionan a la junta directiva y votan sobre las políticas corporativas.




Crowdfunding


El crowdfunding ayuda a pequeñas empresas a conseguir financiación más allá de la que puedan aportar bancos, amigos y familiares. Se utiliza como fuente de financiación para proyectos muy diversos. Las plataformas de crowdfunding permiten que personas en cualquier parte del mundo puedan ofrecer dinero a personas o empresas.




Demo Day


El Demo Day es el día con el que suele acabar el programa de aceleración de las incubadoras y aceleradoras de startups y consiste en presentar a inversionistas los avances, tanto técnicos como comerciales, que se hayan alcanzado durante el mismo.




Dilution


Se le conoce como dilución a la bajada de precio que sufren las acciones de una empresa derivado de una ampliación de capital. Una de las características básicas de una ampliación de capital es que solo los socios actuales pueden ir a ellas, esto se articula a través de los derechos preferentes de suscripción.




Seed capital


Se refiere al tipo de financiamiento utilizado en la formación de una startup. El financiamiento se realiza a través de inversionistas privados, generalmente a cambio de participación en la empresa.




Fundraising


El levantamiento de capital es salir como emprendedor a venderle la idea de un proyecto a uno o muchos inversionistas, con la finalidad de convencerlos de que inviertan en el y se realice dicho proyecto.




General Partner (GP) and Managing Partner (MP)


Un General Partner es el propietario de una sociedad y participa activamente en las operaciones diarias del negocio. Un Managing Partner es lo equivalente a un director general de una corporación en términos de deberes y responsabilidades, pero en una sociedad o empresa pequeña y no una corporación.





Angel Investors


An angel investor is a high net worth individual who provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company.




App


A software application that is designed to be downloaded into a mobile device and be
used by customers or businesses.




Carry


The percentage that Venture Capital funds will take on the extra returns in a company.
The industry standard is 20%.




Convertible notes


A short-term debt that can be converted into equity in the future, it includes interest.




Common stock


A security that represents ownership in a corporation. Holders of common stock elect the board of directors and vote on corporate policies.




Crowdfunding


Raising money from a large number of people asking them for small amounts of money to fund a project or a business.




Demo Day


An event that is organized by incubators, accelerators, or founders where they can
pitch their business project in a room full of investors.




Dilution


The decrease in the shareholder’s ownership in a company when raising new funds.




Seed capital


It refers to the type of financing used in the formation of a startup. Funding is provided by private investors—usually in exchange for an equity stake in the company or for a share in the profits of a product.




Fundraising


The process of generating money from investors in order to build a business.




General Partner (GP) and Managing Partner (MP)


A general partner is an owner of a partnership who has unlimited liability. A general partner is also usually a managing partner and active in the day-to-day operations of the business. A managing partner is roughly equivalent to a chief executive officer of a corporation in terms of duties and responsibilities, but in a partnership or small firm and not a corporation.





Syndicate


Alianza temporal de empresas o individuos con la finalidad de gestionar una transacción, que sería difícil, o imposible, de realizar individualmente. La sindicación facilita a las empresas generar interés de inversionistas menores, ya que juntan sus recursos y se representan por 1 sola entidad.




Incubator/Accelerator


Las incubadoras y aceleradoras de empresas son organizaciones que ayudan al desarrollo de un negocio evitando su fracaso precoz y colaborando con su fortalecimiento dentro del mercado. Se busca poner en marcha su negocio en un corto plazo, de 90 días a 4 meses aproximadamente. La diferencia entre ellas es que las incubadoras ayudan a salir al mercado mientras que las aceleradoras ayudan a proyectos ya en desarrollo.




LP


Un limited partner (LP) es un copropietario de una empresa. A diferencia del socio general, quién supervisa y dirige el negocio, los socios limitados no participan en la gestión.




Pitch


El pitch es una presentación que se realiza para que un posible inversionista considere la opción de invertir en una empresa o de hacer negocios con el emprendedor. Utilizando soporte audiovisual, un pitch debe ser lo más atractivo posible para captar la atención de los inversionistas. Lo ideal es que dure no más de 10 minutos y se logre explicar el negocio en su totalidad.




Preffered stock


Las acciones preferentes son títulos de propiedad parcial de una empresa que ofrecen un valor añadido al accionista. Este tipo de acciones tienen algunas ventajas sobre las acciones ordinarias o comunes, la principal siendo que paga dividendos antes que a las acciones ordinarias; sin embargo, no otorga derecho a voto.




Pro Rata rights


Se le conoce como derechos de prorrata a mantener la propiedad de una empresa mediante la obtención de acciones adicionales. Cuando una empresa recauda fondos en rondas futuras, los inversionistas anteriores tienen el derecho de invertir de nuevo, para evitar que sus acciones anteriores se diluyan.




SAFE (Simple Agreement for Future Equity)


El SAFE es un acuerdo entre el inversionista y la empresa que entrega opciones de acciones en de la startup sin tener que determinar un valor específico por acción. El inversionista recibe un contrato de opción de suscripción de acciones que se convertirá cuando exista una inversión con valorización o en un evento de liquidez (exit).




Share/Stock


Una acción es un título que representa la propiedad de una fracción de una empresa. Esto le otorga derecho al propietario de las acciones a una proporción de los activos y beneficios de la empresa, en proporción con las acciones que este posee.




Startup (Portfolio Company)


Una empresa que está en etapas tempranas de funcionamiento, por lo general levantan capital a través de fondos de capital de riesgo (VCs).




Venture Capital


El capital de riesgo es una forma de capital privado. Los fondos de capital de riesgo invierten en empresas que tienen potencial de crecimiento a largo plazo a cambio de participación. Generalmente proviene de inversionistas con alta capacidad de inversión, bancos de inversión o cualquier otra institución financiera.





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