A sidecar fund is a pooled investment vehicle that makes investments by “riding alongside” another investor.
A pooled investment vehicle means an investor puts their money into a common pool with other people.
Riding alongside means the pool invests in conjunction with some other investor – an angel group, VC or PE fund, or some other investor.
And makes investments is self-explanatory: these funds invest in some kind of assets – in this case, early stage angel investments.
This is also a sidecar – but, like sidecars that invest alongside VC funds, or state pools of capital that invest alongside multiple angel groups, we aren’t exploring those in this primer.