The Impact First Fund is an alternative investment fund, which will provide a portfolio of investments in unquoted impact technology companies. The target return is an aggregate of 3x capital over 7-10 years. Returns will be focused on capital gains, and investors are unlikely to receive any dividends. The fund is evergreen.

Why invest

Positives

• Strategy: To provide exposure to a portfolio of impact investments, focused on B2B technology companies.

Issues

• Track record: While the early investments are generally moving in the right direction, the track record lacks depth so far.

The investment manager

Positives

• Team:  There is an experienced team with a strong investment framework, particularly for assessing impact.

Issues

• Team size: The team is small and will need to expand as funds grow.

Nuts & bolts

• Duration: The fund is evergreen, with closes as required.
• Diversification: The manager expects to provide a minimum of six companies.
• Valuation: Generally, valuations will use the latest transaction price.

Specific fees

• Fees: Combination of direct fees and company charges. There is an initial fee charged to the investor, with annual fees charged to investee companies.
• Performance fee: Charged at 15% on aggregate returns over the gross subscription, on a portfolio basis.

Risks

• Target returns: The target return of 3x capital suggests a high-risk investment strategy.
• Companies: Supplying risk capital to early-stage companies, most of which will rely on technology. There will be a spread of company returns as the successful ones will do very well, but those that fail may do so completely.