---
number: 2
title: "For most emerging managers, SPV-first beats fund-first"
date: 2026-10-22
pillar: "Emerging managers"
image: /images/notes/note-002.jpg
width: 1228
height: 1536
alt: "The fund I math. €30M first close, €600K a year to run a firm. 2% management fee on committed capital is the whole budget before the fund proves anything. €75K fund admin minimum, €525K left for the AIFM, lawyers, the team, travel and deal costs. SPV first. Fund second."
gallery:
  - src: /images/notes/note-002-2.jpg
    width: 480
    height: 600
    alt: "Same GP, two ways to a fund. Fund-first: raising, no closes, no fee until first close. SPV-first: SPV 1 to SPV 4, then the fund; every SPV is a closing, a track-record data point and an LP who has already wired. Run every SPV as if it were already a fund."
  - src: /images/notes/note-002-3.jpg
    width: 480
    height: 600
    alt: "SPVs aren't a workaround anymore. SPV deals for venture-backed startups on Sydecar: 274 in 2022, 522 in 2023, 769 in 2024, 2.8x more in 2024 than in 2022. Share of $10M+ SPVs charging a fee: 41% to 67%, 2021 to 2023. Not a workaround. A business model."
linkedin: "https://www.linkedin.com/posts/martinbodocky_emergingmanagers-spv-venturecapital-ugcPost-7519106902690197504-KB3z/"
sources:
  - label: "PitchBook, How emerging managers use SPVs in a tough market"
    url: "https://pitchbook.com/news/articles/emerging-managers-spvs-fundraising-tough-market"
  - label: "Carta, Co-investment structures"
    url: "https://carta.com/learn/private-funds/structures/co-investment/"
  - label: "Hustle Fund, Offering the right to co-invest"
    url: "https://www.hustlefund.vc/post/offering-the-right-to-co-invest"
---

In my last post, one line triggered most of the discussion:

"With little cash before first close, go SPV by SPV first, then the fund."

So here is the full case. For most emerging managers, SPV-first beats fund-first.

1.) Fund I economics don't work at first close.
2% on a €30M first close is €600K a year. A €75K admin minimum takes one-eighth of that before the AIFM or the lawyers send a bill. It's the math most first-time GPs make nervous 🤐.

2.) An SPV is a sample. A blind pool is a promise.
In a fund, the LP is underwriting you and a thesis. In an SPV, they see the company, the memo, the valuation and the terms. Nothing makes your judgment visible faster.

3.) The market has already moved.
Sydecar: 274 SPV deals in 2022 → 522 in 2023 → 769 in 2024. Capital raised more than doubled to $476M.
Carta: the share of $10M+ SPVs charging a fee went from 41% to 67% in two years.
This isn't a workaround anymore. It's a business model.

4.) You never stop fundraising.
Every SPV is a closing. Every closing adds a track-record data point and an LP who has already wired money to you. When you launch the fund, you're converting co-investors, not pitching strangers.

But SPV-first has a price most people underestimate:
→ Every SPV is its own entity. Bank account, docs, tax, reporting. Five deals = five mini-funds to run.
→ Allocation. When a deal gets hot, who gets in? Without a written allocation policy and a log of every offer, "co-investment access" turns from a perk into a trust problem.
→ "No fee, no carry" is not a definition. Put fees, carry and broken-deal costs on paper before the first wire.
→ Lighter structure doesn't mean no rules. You are still running an investment business, with the regulatory, KYC and fiduciary obligations that come with it.

My rule: run every SPV as if it were already Fund I.
Same quarterly report, same template, same cadence, from day one. Then LPs read you like a fund before you ever ask them to commit to one.

LPs, honest question:
Would you rather back a manager with 5 SPVs and 8 quarters of clean reporting, or a first close with a great deck and a big anchor?