Fund Twenty8 is the only passive EIS fund that automatically invests alongside Business Angels and VCs, who according to NESTA can generate average returns in excess of 20% IRR.
And with diversification said to be the only free lunch in finance, Fund Twenty8 will invest in at least 28 companies, as further research suggests that this is the minimum portfolio size required to have a 95% chance of backing at least one company returning 10x or more.
The benefits of passive investing
Research shows that two factors which may increase chances of a return are 1) investing in the sector in which you’re most experienced and 2) building a diversified portfolio of ideally uncorrelated investments. Already the problem is apparent: if you only invest in sectors you’re intimately familiar with, how can you build in diversification? If you choose all your investments yourself, you will be investing in sectors you don’t know.
We believe, with Fund Twenty8, investors are able to gain diversification, potentially reaping the benefits of both a traditional investment fund and investor-led equity investment.
Our passive fund will automatically follow the private EIS opportunities listed on SyndicateRoom that receive commitment from SyndicateRoom investors. Each of these opportunities will have been led by a professional or lead investor, then backed by other SyndicateRoom members.
Rather than relying on a single fund manager, as with some traditional funds, investments are sourced, structured and invested in by business angels, VCs and other lead investors. The fund then tracks and matches the appetite of SyndicateRoom members, who are sophisticated or high-net-worth investors, to define how much capital is allocated into each deal. This is done on a proportional basis until the company’s funding target is met. If an investment is oversubscribed and goes into overfunding, the fund then invests more, securing a larger weighting.
Fund Twenty8 takes advantage of the expertise of other VCs, angels and investors to invest across sectors, giving you a diversified portfolio. After all, 28 heads are better than one.
MAXIMUM FUND SIZE£25m
CLOSE DATE5TH APRIL 2017