Singapore’s Fullerton tokenises PE fund-of-funds
Singapore’s Fullerton Fund Management has tokenised its latest private equity fund-of-funds, allowing for a minimum commitment size of USD 10,000.
This process leverages blockchain-enabled smart contract technology to fractionalise investment products without the use of feeder funds. The concept entails various benefits around transaction speed, distribution efficiency, and transparency, but is most strongly associated with an industry shift toward mass affluent investors in fundraising.
Partners Group became the first major private equity firm to explore the technology in September last year with its Global Value SICAV Fund, which can also accommodate commitments of USD 10,000.
Fullerton Optimised Alpha Fund is a closed-end fund targeting 8-12% in returns per annum over a period of seven years. A liquidity option in the form of quarterly gated redemptions is available to investors.
The fund-of-funds will be invested in six to eight private equity and private credit funds, diversified by geography globally as well as across buyout, growth, secondaries, and private or distressed credit strategies. Sectors considered defensive, tech-enabled, related to post-COVID-19 dislocation and recovery or environmental, social, and governance (ESG) themes will be favoured.
Fullerton and Partners Group were both serviced by Singapore-based digital securities exchange ADDX. Founded as iStox in 2017, the company raised USD 50m last year from a group of mostly Japanese VC investors. Its other clients include Harmilton Lane, UOB, Investcorp, Seatown Holdings International, and Azalea Asset Management.
Both Seatown, which launched its latest fund targeting mass affluent investors in March, and Azalea are divisions of Temasek Holdings. Temasek is considered a leader in the broader theme of opening private equity to retail investors and contributed to ADDX’s seed round in 2018. The Singapore government investor also controls Seviora, a holding company that includes Fullerton.
“The partnership between Fullerton and ADDX is unique and synergistic. By leveraging the ADDX platform, we can provide wider access to our private market expertise,” Mark Yuen, Fullerton’s chief business development officer, said in a statement. “Through ADDX we can reach a broader base of investors to help them achieve well-diversified portfolios that can match their long-term investment objectives.”
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