Overview
A Special Purpose Vehicle (SPV) is a simple legal structure set up to pool money from multiple investors into a single investment. In VC and PE, SPVs are often used for startup funding. They are usually an LLC and make it possible to combine many small checks from angel investors into one larger investment. This way, instead of a startup having dozens of angels listed individually on its cap table, all of them are grouped together under one line item represented by the SPV, and at times alongside larger angel or institutional investors.
SPVs: Pros and Trade-Offs
For startups, individual angels and angel groups, small and large VCs, and accelerators (e.g., Y-Combinator) and venture studios, SPVs make fundraising easier by pooling smaller investors, enabling syndicate leads to bring in their networks without a full fund, and isolating risk for both founders and investors.
Platforms like AngelList, Assure, Carta, Allocations, and Flow streamline setup, but costs add up—$8K–$12K upfront, $2K/year in admin fees, and sometimes 10–20% carry. While efficient and flexible, SPVs come with trade-offs: expenses can be high for small rounds, investors cede control to the lead, and follow-on or secondary deals can get messy.
Still, they remain a widely used tool for expanding access to early-stage investments.
Why Are SPVs in the Spotlight Today?
OpenAI and Anthropic are pushing back against investments via SPVs because they're concerned these vehicles are undermining their control over who becomes a shareholder—and in some cases even facilitating unauthorized or fraudulent transactions.
OpenAI says it has banned unauthorized SPVs because they violate transfer rules, won’t be recognized as valid, and carry no economic value. The company also wants to stop fraudulent or exploitative schemes in the AI investing frenzy and ensure transparency in its cap table by directly approving shareholders to protect governance and control.
With its $5B raise at a $170B valuation oversubscribed fivefold, Anthropic has the leverage to require direct investments. The company is also steering clear of SPV abuses like excessive fees and pyramid-like structures, while prioritizing direct, long-term relationships with top-tier investors over anonymous SPV participants.
Another reason why this issue has come up recently is because these two companies have strong secondary markets—for both companies Hiive and Forge Global.
What This Means for Founders and Startups
SPVs shine brightest when first-time founders are just getting their startup off the ground—still duct-taping prototypes together, chasing a little customer traction, and working towards product-market fit. They’ve long been the go-to way for a lead investor – who may be investing $250,000 to $500,000 – to wrangle early believers in the classic “friends and family” round. Translation: it’s how Aunt May or Grandpa Joe can toss in $1,000 or $10,000 to back their favorite nephew’s or granddaughter’s “world-changing” idea…which at the moment is mostly a half-working app, some vision and a lot of enthusiasm.
For companies like OpenAI and Anthropic, as they gain leverage and move toward larger financings or public offerings, their focus shifts to streamlining administration. They grow less inclined to grant dilution protections, assume governance risks, or obscure the quality of their investor base. Later-stage or high-demand companies typically prefer direct ties to major, top-tier investors, leaving little room for smaller checks from angel investors. If this trend takes hold, it will only add to the challenges early-stage companies already face in securing financing.