SPV formation has exploded. Carta reports a 116% increase in SPV creation over five years [1] and a 198% jump between 2021-2023 versus the prior three years. Sydecar recorded 769 SPV deals in 2024 [2], up from 522 in 2023 and 274 in 2022, with more than 35% at the seed stage. The median SPV on Carta holds $2.17 million in assets now, up from $1.18 million in 2016. Single-deal vehicles went from niche to mainstream.
But more SPVs doesn't mean better SPVs. LPs have gotten much sharper about evaluating SPV track records, and the gap between a track record that opens doors and one that gets a polite pass is bigger than most first-time managers realise.
The attribution trap
This is the mistake that sinks more aspiring GPs than any other: investing in someone else's SPV and presenting it as your track record. If you participated in a syndicate led by another manager, you were an LP. You weren't demonstrating fund management capability. Sophisticated allocators see through this instantly.
A credible SPV track record means you sourced the deal, led diligence, structured the vehicle, raised the capital, and managed the investment post-close. Attribution letters from prior funds help, but the strongest signal is public evidence: board seats, press mentions, founder references. If your only proof of involvement is that you wired money into someone else's deal, that's a portfolio, not a track record.
What LPs actually look for
The industry has shifted hard toward distributions over paper gains. Only 42% of 2020-vintage funds had distributed anything as of Q3 2025 [3], up from 28% a year earlier. The 2020-2021 era produced funds with sky-high TVPIs from unrealised markups that later evaporated. LPs learned the lesson: paper valuations collapse. Cash doesn't.
This puts SPV managers in a tough spot. Your investments probably haven't exited, so you're showing TVPI without DPI. The booming secondary market ($162 billion in transactions in 2024 [4], $103 billion in H1 2025 alone [5]) is becoming one way to generate earlier liquidity. But without exits, LPs look at other signals.
GoingVC's research on LP evaluation [6] identifies the patterns that actually move the needle:
- Thesis consistency across deals, not opportunistic scatter.
- Sourcing quality: inbound founder referrals are stronger than syndication participation.
- Documented decision-making: formal investment memos and post-mortems.
- Founder references that describe specific help you provided.
LPs are underwriting your process, not your luckiest deal. They typically benchmark claims against Cambridge Associates quartile data [6], and GPs who reference medians and upper quartiles show they understand base rates rather than just pitching outliers.
SPV economics, decoded
Platform competition has standardised SPV pricing fast. Carta's 2024 data puts the median management fee at 1.9% [7], but only 44% of SPVs charge one at all. Among larger vehicles (over $10M), that goes up to 67%.
Carry is evolving too. Sydecar's 2025 fee report [8], based on SPVs formed between October 2024 and October 2025, shows emerging managers moving past the "2 and 20" template. Typical carry now ranges from 15-25% depending on deal complexity and the LP relationship.
Formation costs have dropped. AngelList runs $8,000-$10,000 in setup and filing, with minimums around $80,000 in capital raised. Sydecar starts at $4,500-$12,500 [9], with surcharges for pass-through structures. The full annual cost envelope (formation, administration, filings, K-1 preparation) runs $15,000-$25,000 per vehicle. Workable for a $2M vehicle. Painful for a $200K one.
This explains a market reality: managers who use SPVs effectively run larger vehicles ($2M+) with a stable LP base. Assembling micro-SPVs ad hoc for each deal is expensive and doesn't build the relationships that matter for Fund I.
Structural and regulatory considerations
Most US SPVs are Delaware LLCs relying on Reg D exemptions. The 506(b) vs 506(c) choice matters more than people think. 506(b) allows up to 35 sophisticated non-accredited investors but bans general solicitation. 506(c) allows broad marketing but limits participation to verified accredited investors. SEC guidance from March 2025 eased the verification burden for 506(c), making it more practical for managers who want to market beyond their existing network.
A deadline worth flagging: by January 2028, private fund managers must implement full AML/KYC programmes under new FinCEN rules. Managers who build digital compliance infrastructure now will be ready. Managers still collecting scanned passports via email will have a rough catch-up.
Tax admin is another underestimated risk. SPVs file Form 1065 and issue K-1s annually. Late K-1 delivery (investors need them by March or April) erodes trust immediately. Multi-state filing obligations compound with each new investor jurisdiction.
Does the performance edge hold up?
The VC Factory's analysis of multiple datasets shows emerging managers have historically outperformed established peers across metrics and vintage years [10]. Carta's data on 2,500+ venture funds breaks this down by vintage year, size, and stage [11].
But the picture isn't simple. Cambridge Associates data for Europe specifically tells the opposite story [12]: established funds (fifth generation or later) averaged 2.71x TVPI and 19.75% IRR, while first-time funds averaged 1.65x and 9.77%. The European dataset is smaller (223 funds), which may explain the discrepancy, or it may mean European LPs should focus less on "emerging vs established" and more on process quality.
What's consistent everywhere: concentrated portfolios, personal capital at risk, and genuine skin in the game tend to correlate with outperformance. But capturing that edge means surviving the fundraise, and that's where operational quality becomes the deciding factor.
Getting from SPVs to Fund I
The typical path, documented by SVB, Gen II, and various formation advisors: 20+ SPV deals over roughly two years, a stable LP network, a refined diligence process, then the conversion to a first fund. First-time fundraises take 12-18 months normally, 18-24 in slower markets.
The McKinsey Global Private Markets Report 2026 confirms the headwinds: fewer first-time funds than at any point in the past decade [13]. M&A among the 100 largest GPs doubled from $18 billion to $34 billion between 2024 and 2025. The industry is consolidating.
What separates managers who make the jump from those who keep running SPVs forever isn't just returns. It's whether your SPV operations demonstrated the repeatability and professionalism that LPs need to see at fund scale. Clean audit trails, timely reporting, professional investor comms, documented investment process. These are the proof points that convert SPV investors into Fund I LPs.
How Infra One fits in
Our SPV product is built for the emerging manager path, from first deal through Fund I. Digital onboarding with automated KYC/AML, capital call processing, K-1 coordination, investor reporting, secure data room. The same platform that runs your SPVs scales to your first fund, so you don't rebuild infrastructure during the most sensitive phase of your fundraise.
If you're running SPVs and thinking about Fund I, let's talk.
DISCLOSURE: This communication is on behalf of Infra One GmbH ("Infra One"). This communication is for informational purposes only, and contains general information only. Infra One is not, by means of this communication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services nor should it be used as a basis for any decision or action that may affect your business or interests. Before making any decision or taking any action that may affect your business or interests, you should consult a qualified professional advisor. This communication is not intended as a recommendation, offer or solicitation for the purchase or sale of any security. Infra One does not assume any liability for reliance on the information provided herein. © 2026 Infra One GmbH All rights reserved. Reproduction prohibited.