How to Create an SPV for Friends and Family Rounds: A Simple Approach

When you’re just starting, friends and family are often the first to believe in your idea. Their early support is valuable, but managing multiple small investments can become complicated quickly. As more people want to contribute, your cap table grows, and so does the administrative load . That's where a Special Purpose Vehicle, or SPV, is helpful. Rather than taking individual checks from each individual , you can set up an SPV to capture all the money in one account and treat it as one entry on your company books. It simplifies the process, maintains relationships, and keeps you organized as you grow and expand. Let's go through the steps of building an SPV for your friends and family round in the most straightforward manner possible. Understanding the Basics An SPV is a distinct legal entity formed expressly for one purpose—usually, to invest in one thing. In the case of early-stage fundraising, it serves as middleman between your ...