The Venture Capital 10:90 (VC10:90) Fund has been established to assist investors with diversification opportunities for their investment portfolios, and to provide access to unique offerings by way of Early stage, Mid stage and Late stage Pre-IPO offerings in exciting new startups focused on Fintech opportunities.
The structure of the Fund is by way of an Australian Managed Investment Trust (MIT). The Trust will invest capital on behalf of investors into venture capital opportunities that meet the investment mandate and target return profile of the Fund.
Structure of the Fund
The Fund will have two classes of units which will provide a unique investment opportunity for investors.
Class A units will have a first loss position on any equity losses within the Fund, protecting the Class B units from capital loss to the value of the Class A units. The target value of Class A units will be ten (10) percent of the capital on issue. Class A units will be entitled to a preferred return of one time the capital amount, to compensate for the high risk being born by these investors. For example, A Class A unitholder who invests $500,000 will be entitled to $500,000 of income distributions (post fees) prior to the distributions of remaining profits to Class B unitholders.
Class B units will have protection from capital loss up to the value of Class A unitholders equity investment. As the capital protection provides for a medium risk investment opportunity. We are targeting an IRR return of 25%p.a. after fees for this unit class.
What are the basic entry requirements (eligibility)?
In order to be able to invest in this opportunity you must meet the investment criteria of a Wholesale or Significant Investor:
Provide an accountant’s certificate noting that the investor, company or superannuation vehicle meets the requirements
Income of over $250,000 per annum for the prior two years
Net assets of over $2,500,000 or,
Invests a minimum of $500,000.
The Fund will deploy capital on behalf of the investors, in various stage Venture Capital opportunities. The attribution will be assessed for each investment to ensure the Fund is able to target its return profiles outlines in this offer document:
Early Stage / Angel investment: investment in early stage venture capital, with a normal exit strategy of 4-6 years. This investment will normally hold the most risk, but also the highest return opportunities
Mid Stage Venture Capital: Investment in mid stage venture capital, has a normal exit strategy of 2-4 years. In this case the investment has normally been proven and is in active development stages. These investments have the ability to deliver higher returns but are slightly less risky when compared to Early Stage investment.
Late Stage / Pre-IPO: Investment in Late Stage Pre-IPO opportunities have a normal exit strategy of 12-18 months. These investments are normally far less risky, as the VC companies normally have an established business model, market share and are normally delivering cashflow positive returns for its investors. Investment at this time is sometimes secured as being able to offer liquidity to Early Stage investors, rather than a larger capital round to fund development and expansion with Early and Mid-Stage investments.
There are various risks typically associated with any investment including: