A Distribution Plan in InvestNext allows you to define a custom waterfall for each project. When you are ready to distribute funds to investors, whether it be a quarterly preferred return payment or a profit share after exiting a project, a Distribution Plan will programmatically allocate the funds to your investors, removing any manual calculation or excel work from the process.
IMPORTANT:
Before running your distribution plan, confirm that you have completed the items below to ensure the system has all the information required to calculate the distributions:
ITEM 1: Set the Ownership Percentages for each Class in the Project: Setting Class Ownership Percentages
ITEM 2: Verify that each Class has a Class Unit Price. Use this article: Update Class Unit Price (Project)
Use the steps below to create a new Distribution Plan.
STEP 1: Navigate to the relevant Project and click on the Distributions tab.
STEP 2: Click on the Distribution Plans button:
STEP 3: Click New Distribution Plan, add an identifying name and click Create Plan.
STEP 4: Select a Remainder Allocation Method
This will determine how the system will handle the allocation of an uneven amount of change. For example, if there are 7 cents remaining to allocate between 15 investors.
STEP 5: Select Add Hurdle. Name your hurdle and select the relevant Hurdle Type.
To learn more about a waterfall hurdle types, please review the options in this document:
STEP 6: Click the three vertical dots beside the hurdle name and click Edit to customize the hurdle details:
STEP 7: Repeat Steps 5 & 6 as necessary.
If your project has multiple types of distributions, you can create additional Distribution Plans using the same process and you will be prompted to select the relevant option when creating a distribution.
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