Most entrepreneurs typically hold 99% of their net worth in their company’s common stock and balance sheet.
They’d like to get some diversification, but are confident their venture will succeed--and don’t want to sell their stock too soon or too cheaply.
That’s why First Round Capital has coordinated the first ever VC-sponsored Exchange Fund. This fund allows qualified First Round Capital entrepreneurs to contribute a small piece of the stock they own in their company -- and share in the performance of all the other companies in the fund. The fund is only available to qualified First Round Capital portfolio companies and First Round Capital does not receive any economic upside from the fund. The goal of the fund is to allow our entrepreneurs to get the benefit of some diversification without giving up their upside prematurely.
