“A lot of managers will meet with 300 or 400 unique investors over the course of a fundraise. That’s incredibly time-consuming,” Vene said.
A number of online companies have arisen in recent years to address the needs of general partners and limited partners, among them Palico SAS, founded in 2012 by Antoine Dréan, who previously founded Triago, the Paris-based placement agent, and CapLinked, which launched in 2011 with backing by venture capitalists Peter Thiel and Dave McClure as a lower-cost alternative to online deal rooms.
Vene said iCapital Network, which is now in beta testing with GPs and LPs, plans an official general release in late April. iCapital will differentiate itself by allowing its users not only to communicate but also to transact.
iCapital Network, which was founded in 2013, seeks to jumpstart its online community through a joint venture with IntraLinks, perhaps the largest online document repository, Vene said. IntraLinks has 135,000 unique LP employees on its system, representing perhaps 5,000 to 6,000 institutions, all of whom will be able to access iCapital Network. Data providers include PrivCap, the Burgiss Group, Preqin and Dow Jones. And the network has partnerships with placement agents Credit Suisse and Eaton Partners, which may work with iCapital to offer their marketing services online.
Vene has a background as an Internet entrepreneur. An earlier startup, earnings.com, was acquired by Thomson Financial, a predecessor of Thomson Reuters, the publisher of Buyouts, before Vene went on to Eaton Partners. Phil Pool, the former head of the DLJ fund placement group, is now chairman of iCapitalNetwork (as well as chairman of placement agency First Avenue). Also on board are John Robertshaw, chairman of the Credit Suisse private funds group, where he continues, and Nick Veronis, a co-founder of New York-based Veronis Suhler Stevenson, a former sponsor of markets data provider Ipreo LLC, which the firm sold to Kohlberg Kravis Roberts & Coin 2011 for $425 million. All four founders made “material capital investments” in the company, Vene said. He said he and Veronis work there full-time.
iCapital Network plans to offer introductory materials on behalf of GPs, including video profiles of GPs and a private messaging system that an LP could use to request a PPM, Vene said. Beyond those services, the company plans to offer an access channel for qualified investors to obtain what he called “true pari passu interests in private equity funds.” The company plans to take responsibility for vetting high-net-worth individuals and producing the financial reports that individuals need for their taxes.
The company plans to charge GPs an annual subscription, which is now being negotiated with early clients but probably will range from $12,000 to $36,000 depending on service levels, Vene said. LPs will access the platform at no charge, and high-net-worth investors and retail wealth management clients will pay placement fees and annual asset management fees.
Although tilted toward private equity, iCapital Network plans to offer its services for alternatives more broadly, including real estate, credit, timber, agriculture and natural resources funds, Vene said. The company hopes to have four or five placement agent partners at launch and as many as 60 GPs shortly after launch.