For Stakeholders
Stakeholder FAQ
A Consolidation Vehicle helps companies manage the administrative overhead incurred by large cap tables and streamlines future transactions such as future financings or acquisitions.
Does signing this impact my economic stake in the company?
No – this does not change your effective ownership the company, instead it allows the company to more easily manage stakeholders by consolidating many into a single line on their cap table. Some Consolidation Vehicles are also configured with a proxy or power of attorney.Does this impact QSBS?
No. It is mereley a corporate transaction to make legal and administrative tasks simpler for the company.How will future distributions work?
- For stock proceeds of a private company, the single entity for the consolidation vehicle holds the stock.
- For stock process of a public company, the single entity for the consolidation vehicle holds the stock and disburses it out to investors in-kind through a transfer to their brokerage or provides investors with the option to sell.
- For cash proceeds, the single entity for the consolidation vehicle receives the proceeds and manages the disbursement to the investors’ accounts.