Hi [first name],
Awesome, yes of course! That's exactly one of the benefits of us leading the syndicate for you. If you want to send them an email or talk to them about this, you can say something like this:
"We would love to have you join us as a champion and investor. We see the value in having supportive angels in our corner, and early-believers like yourselves being part of the journey, is a huge plus for us.
At the same time, we are conscious it's important to maintain a clean cap table that will be workable as we grow and raise further rounds of funding.
Therefore, we're excited to announce we have secured [SYNDICATE LEAD NAME] as one of our lead angel investors and they are running a syndicate for our company in this funding round. They have kindly offered to allow other investors (outside of their personal network), that we refer to join. This will allow us to accept more investors in our current round, be flexible with lower minimum cheque sizes, and not need to exclude anyone due to cap table restrictions.
If this is something of interest, please let us know.
FAQ
What is a syndicate? A syndicate is a group of investors who invest together as one entity on a cap table.
Benefits to angels:
You access opportunities that your cheque size may not allow you to invest in
Lead investors share their deal flow, you review them deal-by-deal.
There's no sign up fees, you only pay when you decide to invest.
Benefits to startups:
Founder friendly structure, with only one investment entity on the cap table
Save time & hassle rather than directly liaising with up to 50 angel investors and the related paperwork
An easy way for founders to bring on many smart helpful investors they can tap into, without the added admin
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Note to leads: be sure to read these important notes for this founder question.