Strategy: A generalist that will focus on areas in which the investment team has particular expertise.
Issues
Track record: Given Vala’s short history, the track record so far is limited with no exits.
The Investment Manager
Positives
Team: The Investment Committee has a broad range of entrepreneurial experience and a successful track record prior to Vala of building and exiting companies.
Issues
Key man risk: Jasper Smith is the key person for Vala, although that risk may be reduced as the team grows.
Nuts & Bolts
Duration: The Fund is evergreen, with three closings per year, and investors receive a proportionate share of the next tranche of investments.
Diversification: The manager aims to provide six to ten investments for each investor, with no more than 20% in one company.
Valuation: Mixture of last transaction and internal valuation.
Fees
Fees: A very simple fee structure, with no AMC and only an initial fee charged
to the investee company plus the performance fee, with the aim of focusing Vala on exits.
Performance fee: Charged at 20% on aggregate returns over 100% of subscription.
Risks
Target returns: The target return of doubling capital after fees suggests a
medium- to high-risk investment strategy.
Companies: Supplying risk capital to early-stage companies, with a mix of pre-
and post-revenue investments. There will be a spread of company returns as the successful ones will do very well, but those who fail may do so completely.
