4 reasons why we invest with a deal-by-deal approach

At Capital Mills we structure our equity deals in a deal-by-deal approach. This means that separate investment vehicles (Special Purpose Vehicles) are created for each investment. We thus flip the traditional fund model on its head: where normally, a Venture Capitalist would first raise a fund in order to invest in multiple deals, we first curate and select our deals, and then raise the funds with our investors. This approach gives at least 4 upsides, for investors, for founders and for us alike.

 Pooling more money for later stage deals

Normally, an angel investor has the opportunity to invest about €50-250k of his/her own money in a startup every year. Traditionally, they would enter the cap table individually. If a large group of angel investors would do the same, the cap table management for the startup would be too cumbersome. Therefore, the total round size is limited. With Capital Mills setting up and managing a special investment vehicle for each and every investment, a larger group of angels can join every round. Therefore, we are able to invest up until late-seed with equity, up until €2,5m.

We can invest in a broader range of companies

Venture Capitalist will raise their funds based on relatively strict ‘fund mandates’, where they commit to certain round sizes, industries and company stages. With ‘deal-by-deal’ investing, there are less restrictions. This allows Capital Mills to be more opportunistic in finding good deals: we can be a lead investor or not, we can invest in secondaries, in seed or beyond, and we are industry agnostic.

Angels can invest without sourcing, due diligence or investment management

At Capital Mills, our team of 6 professionals will source, analyze and do thorough due diligence, before proposing any deal to its investors, who ultimately make a decision themselves. Furthermore, the team keeps careful track of the investments through periodic meetings and will update the investors after. This allows investors to be part of the company’s journey without being overly subjected to investment management tasks.

Founders can leverage the access and expertise of the Capital Mills network

When receiving an equity investment from Capital Mills, they do not only leverage the expertise and experience of our professional investment team – which has invested in more than 20 companies. The founders also have the opportunity to leverage the network of 60 individual investors who are part of Capital Mills, and their respective network, expertise and experience.