Pledge fund

Pledge fund,

Definition of Pledge fund:

  1. Pledge funds are a common approach to venture capital (VC) investing among investors who wish to retain control over individual investment decisions.

  2. A pledge fund is a type of investment vehicle in which the participants agree, or "pledge," to contribute capital to a series of investments. Unlike a blind pool, contributors to a pledge fund reserve the right to review each investment prior to contributing. If they do not approve of the specific investment being considered, they can refrain from investing in that particular project.

  3. A type of fund whereby the members are working towards a certain investment goal. These members will make defined contributions into the pool throughout a specific time period. This type of fund can also be used for venture capital investing.

How to use Pledge fund in a sentence?

  1. The investors reserve the right to opt out of specific investments. By contrast, blind pool investment funds do not offer this level of flexibility.
  2. Pledge funds are popular in the VC community, although they are also used in other industry areas, such as private equity (PE) or commercial real estate acquisitions.
  3. A pledge fund is an investment vehicle in which backers contribute capital on a deal-by-deal basis.

Meaning of Pledge fund & Pledge fund Definition