Arie Tech LLP (Fund)

Taurus Asset Finance / Prosper Capital LLP, EIS & SEIS Report

10 Mar 2017 / Tax enhanced research

Summary: The Fund’s investment strategy is to invest in a portfolio of (S)EIS qualifying technology companies, with a particular emphasis on international technology, especially Israeli.

Why Invest

Positives

Strategy: Exposure to a portfolio of tech companies using proven technology.

Issues

Past performance: The Fund is new and has nopast performance.

 

The Investment Advisor

Positives

Team: Through Arie Capital, they have experience of the Israeli technology market and an established infrastructure.

Issues

Track record: Although they have extensive experience of alternative investments, including media EIS, this is their first tech EIS fund.

 

Nuts & Bolts

  • Offer period: The first closing date will be 24 March 2017, becoming evergreen thereafter.
  • Diversification: The aim is to invest in 4-8 companies, with a minimum of four.
  • Valuation: As unquoted companies there will be little or no change in the valuation, though revenue will be transparent and investors will receive regular updates on progress.

 

Specific Issues

  • Fees: Mixture of direct fees and charged via the investee companies.
  • Performance fee: Subject to a threshold of £1.05 for each £1 invested. Above this, the Fund receives 20% of the investor share of the return on a portfolio basis.

Risks

  • Target returns: The target return of 35% IRR suggests a higher risk strategy within the EIS area and is appropriate for the strategy.
  • Companies: Individual investments will be high risk, with the return profile likely to be skewed, with those that do well giving a larger than target return but the failures may return little or nothing.