Direct vs RUV: two valid ways to bring investors onto your cap table
Founders usually choose between two paths when raising from multiple angels, operators, or friends & family:- Add each investor directly to the cap table
- Pool them into a single line using a Roll Up Vehicle (RUV)
The simplest way to think about it
- Direct investors → each person you add becomes an ongoing cost (legal, admin, cap table fees, future signatures & consents, etc.) — those costs compound over time
- RUV → one fixed cost and one stakeholder on the cap table, even if you add 5, 50, or 250 people
Where the cost actually comes from
| Cost driver | When it shows up | Direct investors | With an RUV |
|---|---|---|---|
| Onboarding (KYC, investment doc execution, wire coordination) | At time of investment | Repeated per investor | Done once at the vehicle level (investor-level items are managed by our team) |
| Cap table fees (software / admin) | Annual | ~$100–$200 per investor, per year | One entry for RUV (no per-investor lines/cost) |
| Stockholder consents & signatures | Every corporate action (eg: financing, M&A, equity plan update, amendment, etc.) | One signature per investor | One signature total |
| Legal/admin for stockholder changes | Anytime investor updates ownership (entity transfers, secondary, etc.) | Repeated per investor | Handled at vehicle level |
| Distributions | Liquidity event | Separate tax docs + wire info and execution per investor | One wire info and execution + one tax flow |
| Audit / tax touchpoints | Each year or diligence event | Repeated per investor | One per vehicle |
Other items that matters just as much (if not more)
✓ Faster rounds — one signature instead of chasing 10–20 people✓ Cleaner diligence — makes diligence for future VCs faster with one (familiar) cap table line
✓ Less founder time lost — fewer follow-ups, fewer admin loops, fewer repeats
✓ Cleaner narrative — avoids the common “messy cap table” risk, which leads to slowdown in future financings and M&A reviews These don’t show up as fees, but they do show up in time, speed, and attention (usually more expensive than pure dollar cost).
When direct is totally fine
✓ You only have 1–2 investors✓ The investor is a large fund or someone who needs their own line on the cap table
✓ You don’t mind the legal/admin costs and any delays from signature executions in future Direct is the right choice when simplicity today doesn’t create complexity later.
When an RUV usually makes more sense
✓ You’re raising from a group of strategic angels / operators and friends & family✓ You want one clean cap table line instead of a growing list of individual investors
✓ You want future rounds and stockholder consents to move faster (one signature vs many)
✓ You want to prevent legal/admin costs from compounding over time RUV is how founders avoid turning today’s raise into tomorrow’s cap table burden.
Founder takeaway
Direct is simplest when the group is small and static. Once you start bringing in multiple individual checks, the long-term cost of managing them (cap table fees, legal/admin costs, etc.) often ends up being multiples of the one-time RUV fee. An RUV keeps that cost flat by turning many small investors into a single stakeholder on the cap table. So, founders typically weigh the “right” option based on how many people they expect to add and how much admin they wish to carry forward.Think an RUV might make sense?
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