What is a nominee structure in crowdfunding?
By SuLe · Updated 14 June 2026
A nominee structure is where one nominee company holds the legal title to all the crowd investors' shares, while the investors remain the beneficial owners. Your company's register shows a single shareholder — the nominee — instead of hundreds of individuals, so you get one line on the cap table and one signature for consents, without stripping investors of the economic value of their shares.
Key facts
- The nominee company is the registered legal owner of the crowd's shares; the individual investors are the beneficial owners who keep the economic rights.
- Your cap table shows one line for the whole crowd, and you obtain one signature for shareholder consents.
- Beneficial ownership means dividends, sale proceeds and upside still flow to the individual investors.
- How the nominee votes and passes on information is set by the platform's nominee terms — read them.
- A well-designed nominee is structured to preserve each investor's SEIS/EIS eligibility, but you should confirm this rather than assume it.
What does the nominee actually hold?
The nominee company holds "bare legal title" to the shares — it is the name on your register of members, but it holds those shares for the benefit of the crowd investors behind it. Legal title and beneficial ownership are deliberately split.
Beneficial ownership is where the value sits. Dividends, proceeds on a sale and any upside belong to the individual investors, and the nominee must deal with the shares in line with the arrangement rather than for itself.
Think of it as a custody layer. The crowd's money bought real shares in your company; the nominee simply holds the paper on their behalf so you are not administering hundreds of separate holdings.
Why do founders and platforms prefer it?
The alternative — hundreds of individual minority shareholders directly on your register — is an administrative drag. Every future round, consent and information right would mean notifying, counting and chasing signatures from a crowd.
A nominee collapses all of that into one registered holder. When you need shareholder approval for a new round, disapplying pre-emption rights or amending your articles, you deal with the nominee rather than herding a mailing list.
That simplicity matters most at the moments that count: your next raise and your exit. A messy register of hundreds of direct holders can slow due diligence and complicate a sale; a single nominee line keeps the cap table clean. [More: How does equity crowdfunding work legally in the UK?]
How do voting and information rights work through a nominee?
This is set by the platform's nominee terms, and it varies. Commonly the nominee votes the entire block on a matter, sometimes after gathering instructions from the underlying investors, sometimes applying a default position.
For you as founder, that can be an advantage — one counterparty for consents — but it also concentrates the crowd's voting power in the nominee's process. You should understand how the nominee decides, so you know what to expect on reserved matters and future rounds.
Information rights work similarly: the nominee typically receives shareholder communications and passes them on to investors under its terms. Read those terms before you commit, because they shape your governance for years.
| Feature | Direct crowd holders | Nominee structure |
|---|---|---|
| Register of members | Hundreds of lines | One line (the nominee) |
| Legal owner | Each investor | Nominee company |
| Beneficial owner | Each investor | Each investor (unchanged) |
| Consents/signatures | Chase every investor | One signature |
| Voting | Each investor votes | Nominee votes the block (per its terms) |
| Due diligence at exit | Slower — many holders | Cleaner — single holder |
Worked example
Sofia raises £300,000 for an online marketplace through an FCA-authorised platform, attracting 480 investors. Rather than adding 480 names to her register, the platform's nominee company becomes the single registered holder of the crowd's shares.
Eighteen months later Sofia runs a priced seed round. To disapply pre-emption rights and issue new shares she needs shareholder consent — and instead of contacting 480 people, she deals with the nominee, which votes the block under its terms.
Her cap table still shows the nominee as one line, with the 480 investors as beneficial owners behind it. Before launch, Sofia had her solicitor confirm the nominee terms preserved each investor's SEIS/EIS eligibility and check how the nominee would vote on future reserved matters.
Where founders go wrong
Not reading the nominee terms
— how it votes and shares information governs your cap table for years; do not treat it as boilerplate.Assuming beneficial owners have no rights
— the economic value and, often, an instruction mechanism still sit with the crowd; the nominee is not a way to sideline them.Overlooking SEIS/EIS mechanics
— relief depends on qualifying beneficial ownership, so confirm the structure supports each investor's claim.Forgetting the nominee at exit
— a buyer will scrutinise the arrangement; understand how the nominee signs up to a sale before you rely on it.
Related questions
Who legally owns the shares in a nominee structure?
The nominee company holds legal title, so it is the registered shareholder on your company's register. The crowd investors are the beneficial owners — they hold the economic rights and upside. Legal title and beneficial ownership are split, which is what collapses hundreds of investors into one line.
Why do platforms use a nominee?
To keep your cap table and admin manageable. Instead of hundreds of individual minority shareholders to notify, count and collect signatures from, you deal with one registered holder. That makes future rounds, consents and an eventual exit far simpler to run.
Is a nominee the same as the investors not owning their shares?
No. Beneficial ownership means the investors keep the economic value — dividends, sale proceeds and upside flow to them. The nominee holds bare legal title on their behalf and must act in accordance with the arrangement; it is a custody structure, not a transfer of the value away from investors.
How does voting work with a nominee?
It depends on the nominee's terms. Often the nominee votes the whole block, sometimes after gathering investor instructions or applying a default. Read the platform's nominee terms carefully, because they determine how crowd votes are exercised on your reserved matters and future rounds.
Does a nominee affect SEIS/EIS relief for the crowd?
It can, so this needs checking. SEIS/EIS relief depends on the investor beneficially owning qualifying shares, and reputable platforms structure their nominee to preserve eligibility — but the detail matters. Confirm the specific structure supports each investor's relief rather than assuming it does.
A nominee keeps your cap table clean, but its voting and information terms quietly shape your governance and can affect your crowd's SEIS/EIS relief — so it is worth understanding before you launch, not after. A SuLe solicitor can review the platform's nominee terms and how they interact with your articles and future rounds. Book a free call before you promote your raise and know exactly what you are agreeing to.
Keep reading: How does equity crowdfunding work legally in the UK? · Can anyone invest in my startup, or are there investor eligibility rules? · Can I publicly advertise that my startup is raising money? · Who counts as a high-net-worth or sophisticated investor? · Do angel syndicates need FCA authorisation?
Primary sources: Financial Promotion Order 2005 · FCA — Financial promotions and adverts
