Organisational structure of investing / consulting LLCs? (by example of seed accelerator Y Combinator)


1

I wonder how companies like Y Combinator are structured. Y Combinator is a seed accelerator, investing in and consulting businesses. On Y Combinator's web site, there is a list of partners. Y Combinator is registered as an LLC.

In particular I wonder:

  • Does partner mean that the person has a share in the company? An equal share?
  • Is it possible that partners are guaranteed a share in the businesses that they consult?
  • Who owns the fund which is the source for investments?

Consulting Corporate Structure Investors Shares Ycombinator

asked Jun 22 '13 at 21:58
Blank
Feklee
148 points
Top digital marketing agency for SEO, content marketing, and PR: Demand Roll
  • @TimJ Why the down votes and the closing? I thought that questions about company structure were on topic. This particular question arose from debates with a friend who is trying to set up a seed accelerator. – Feklee 7 years ago
  • Perhaps you could re-phrase the question to make it more relevant and on-topic. Have you visited the Y Combinator site and done research on them elsewhere on the web? Perhaps you should try contacting them. – Tim J 7 years ago
  • @TimJ Thanks for the suggestion. I now edited the question. I did a lot of reading on Y Combinator over the past years. However, there obviously is information which is not public. On the other hand, I assume that there are certain standards how companies like Y Combinator (consulting, investing) are usually run. – Feklee 7 years ago

1 Answer


1

I don't know about Y-Combinator in particular but most investing funds are organized the same way.

Usually, there is a management company which manages a fund of money on behalf of limited partners who put in the money. The management company partners are called general partners.

  • Partners have shares in the management company, yes. They do not have to be equal shares
  • General Partners are not necessarily granted shares in the portfolio companies themselves, but the Limited Partners are.
  • The fund is owned by the Limited Partners in proportion to the amount of money they each invest.
answered Jun 26 '13 at 04:15
Blank
Joel Spolsky
13,482 points

Your Answer

  • Bold
  • Italic
  • • Bullets
  • 1. Numbers
  • Quote
Not the answer you're looking for? Ask your own question or browse other questions in these topics:

Consulting Corporate Structure Investors Shares Ycombinator