- Further, a company that helps democratize investing in VC funds, is launching this week.
- The London-based company enables users to invest as little as £1,000 in startups that are not publicly available.
- The company allows anyone to invest, as long as they agree not to invest more than 10% of their net assets in shares, bonds, or funds that are not listed or sold on a stock exchange.
The company’s platform enables users to browse, review, and compare funds, and easily invest as little as £1,000. Once the investment is made, Further enlists U.K. fund managers to invest users’ money into startups that are not generally available to everyday investors. Investors receive returns after around five to 10 years when the startup they invest in exits via sale or IPO.
Accessibility is Further’s differentiating factor. The company allows anyone to invest, as long as they agree not to invest more than 10% of their net assets in shares, bonds, or funds that are not listed or sold on a stock exchange.
That limit is in place for good reason– there is significant risk associated with VC investments. However, while many funds fail, others are quite successful. According to Pitchbook, European VC has delivered an internal rate of return of 14% across a 10-year timespan.
At a time when the public markets are in bear territory, Further’s launch comes at an ideal time. “I’d much prefer to be investing in a fund now and getting the valuations VCs are getting now [rather than last year’s],” Further CEO and cofounder Rob Tominey told Sifted. “The early returns will be strong.”
Further makes money in a couple of different ways. The company charges the funds a marketing fee and also charges investors a small percentage. Consumers also face fees from the funds themselves; each fund they invest in charges fees for onboarding and fund management services. Further argues, however, that the tax benefits users receive help to balance out the expense of the fees. “In addition, the company’s website states, “you can receive tax reliefs alongside each fund’s expert knowledge and management. These tax reliefs typically exceed the lifetime fees charged by funds, although this is not guaranteed.”