Newly launched FundersClub has put $509,800 in social video advertising startup Virool, joining other investors Y Combinator, 500 Startups and Yuri Milner. Formed in 2012, FundersClub is an online marketplace that allows accredited investors become equity holders in FundersClub-managed venture funds.
FundersClub ( www.fundersclub.com ), the world’s first venture capital platform, today announced that it has closed its first fund, investing $509,800 in social video advertising startup, Virool. FundersClub joins Y Combinator, 500 Startups and Yuri Milner as investors in Virool.
Transforming venture capital from firm to platform, FundersClub has created a unique online marketplace that allows accredited investors to become equity holders in FundersClub-managed venture funds designed to finance pre-screened private companies. As a result, deserving companies get larger, more consolidated infusions of capital from accredited investors, and access to a highly connected and experienced group of individuals with a vested interest in seeing the company succeed.
“FundersClub’s first investment marks an important milestone for the entire venture capital ecosystem,” said FundersClub co-founder and CEO, Alex Mittal. “This is the first time the venture capital model has been used online, and we’re excited to be unlocking this resource and enhancing the venture capital landscape for both investors and private companies.”
FundersClub reviews each company via an internal Investment Committee, comprised of VC and angel investors, entrepreneurs, and operators to confirm the company meets criteria for listing; and by the FundersClub Angel Panel, a member-driven vetting group, to assess community demand. Since FundersClub’s launch in late July of this year, this process has filtered hundreds of referred companies down to 15 to raise funds via the platform. Virool was part of the first group of companies selected, and is the first to close a fund on the platform.
Virool is pioneering the concept of social video advertising, allowing anyone with a video to reach their desired target audience on Facebook, mobile phones and niche sites. Since the company’s May launch, Virool’s services have already been used by many well-recognized brands, including: Clorox, Colgate, Intel, Levis, Orbitz, Samsung, Sony, and Volkswagen.
“When our business grew faster than we expected, we realized that in order to own the market we needed additional capital,” said Virool CEO Alex Debelov. “The type of capital and value-add that FundersClub offers is a game-changer for rapidly growing startups. Being able to tap into a powerful network, at-will, for recruiting and introductions is an invaluable asset. We are thrilled to welcome FundersClub as a Virool investor.”
Through the platform, FundersClub’s more than 4,000 accredited members are able to browse and invest in individual funds established to finance pre-screened private companies. Each featured fund has a target fundraising goal, a minimum investment requirement — typically $1,000 — and a cap on the number of investors allowed to participate. The unconventionally low minimum investment size also allows FundersClub members to diversify their investments across multiple private companies, with relatively little capital.
Now that the Virool fund is closed, FundersClub’s management entity, FundersClub Management LLC, manages the payment and investing process and serves as the fund manager. The FundersClub-managed venture fund receives and holds investor funds, makes the investment, holds and votes on the stock or holds the convertible note securities, and provides other venture capital advisory services. Because FundersClub acts as the single point of contact between fund investors and the company, companies are spared the headache of coordinating a large group of investors — making group investments an attractive option for private companies.
The platform currently features early, mid- and late-stage private U.S. technology companies from Silicon Valley and beyond. The typical company listed on FundersClub is a startup with high growth and a reputable team.
To become a FundersClub member or apply to fundraise via the platform, visit www.fundersclub.com .
About FundersClub FundersClub is the world’s first online venture capital platform. It is built around a unique online marketplace that allows accredited investors to become equity holders in FundersClub-managed venture funds, which then fund pre-screened private companies. Each funded FundersClub startup benefits from the capital, the advice, and the professional networks of its associated venture fund, and are spared from the overhead of interfacing with a crowd of investors by receiving capital in a traditional venture capital fund format. Investors benefit from greater access to private investment opportunities, a more convenient investment process and the ability to diversify with relatively small amounts of capital.
Launched in 2012 by serial entrepreneurs and investors Alex Mittal and Boris Silver, FundersClub aims to create prosperity and transform people’s lives by supporting innovation.
FundersClub operates and manages all venture funds. All FundersClub members with access to investment opportunities have certified as accredited investors