Purpose
Approve a Forefront Investment Club -- established through Syndicate Protocol -- to allow members of our community to collectively pool funds and invest in a simple and compliant way.
A Forefront Investment Club would give community contributors the ability to leverage the Forefront brand to get into highly competitive web3 deals or access expensive assets that individuals generally could not reach.
Although the Club would not directly return assets back to the Treasury (all returns would go back to investing members), token-gating the club accrues value back to the $FF token and incentivizes the Forefront community to support any portfolio companies and projects of the Club.
Overview
Syndicate Protocol will provide the tooling and requisite legal support to create an on-chain investment club, known as a Syndicate Investment Club. Clubs are groups of investors (no more than 99 individuals) pooling their own funds (no more than $20M total) to invest. Clubs can invest in both on-chain (NFTs, liquid tokens, etc.) and off-chain (startup equity, etc.) assets, and Syndicate's tools will automatically manage fundraising, cap table, and distributions for the Club.
In an investment club, there is no legal differentiation between members and managers -- thus, there is no carry or fees. The Club will appoint a manager to handle the technical aspects of the Club, ensure people are voting and send money, etc. However, from an investment perspective, all members hold equal voting weight and receive returns proportional to the amount of funds invested.
Club Details
Club Details:
- The Club will be open to Forefront contributors and core collaborators.
- After a 3 month trial period, the DAO may propose to open up the investment club to non-contributors (e.g. token-gating).
- Club administration (launch, technical support, etc.) will be managed by the Forefront Staff.
Legal Limitations:
- The Club cannot hold more than $20M.
- The Club cannot have more than 99 members.
- Every member of the Club must actively participate in investment decisions (e.g. vote on each investment).
- The Club cannot receive funds from the DAO Treasury.
- The Club cannot distribute returns back to the DAO Treasury.
Budget
Syndicate Protocol currently does not charge protocol fees. However, there are gas costs associated with creating an on-chain investment vehicle. While the gas costs are unpredictable, $1,000 is a decent ballpark. These funds will be paid out of the Forefront Treasury.
