Participants consisted of ESVCLP and VCLP managers with registered funds, those considering tapping into this market as well as specialist lawyers sharing their expertise. Following were some key insights from the discussion, with the next forum to be held on Tuesday 1st December.

AusIndustry fund set up

There have been a considerable number of enquiries, and the next round of fund approvals will be in December, then March 2016. There is now an initial screening process prior to those looking to set up conditional registration accessing the documentation. An updated Q&A is expected to be released soon.

It was noted that not all eligible managers are interested in SIV Applicants as they have existing pools of HNW and institutional investors. Those seeking to provide a vehicle for SIV investors should bear in mind the need to reach the $10M minimum. Ensuring there is a broader range of investors was suggested, as well as having foundation investors.

Access to Clients

There was much interest on how to source SIV applicants in terms of accessing the influencers and connectors in China. Whilst some managers are looking to build partnerships with migration agents, lawyers and property specialists, most prefer to deal via intermediaries such as wealth managers and bankers rather than end investors directly.  It was noted that VC managers are not allowed to market in China due to licencing restrictions.

Administration

VC managers want the least administrative burden and are looking for platforms to handle back office, administration, and client service. There is a strong need to create efficiencies in terms of banking services to handle cash escrows. Discussion was also focused on AML processes and whether the managers could rely on immigration or other checks in terms of source of funds.

 Disclaimers

Venture capital is a risky asset class and whilst most managers are not translating the partnership documents into Chinese, the key messages to be made clear to SIV Applicants include:

• They can lose all their money
• The funds will be invested for 10 years, well past the grant of the permanent residency visa timeframe
• The fund manager doesn’t guarantee they will get their visa.

Regular Discussion Groups

Overall insight was there are lots of aspects to consider by all participants and it was useful to share initial experience and continue to the conversations as the program progresses.

Below are details of the next forum to be held in Sydney.