Blockchain-powered investment fund Andra Capital wants to make investing in private Silicon Valley companies accessible to the public.
About Andra Capital
Andra Capital wants to set up the first tokenized technology investment fund (the Andra Fund) to focus on privately-held late-stage Silicon Valley companies.
Investing in private Silicon Valley firms used to be limited to traditional venture capital (VC) funds. Andra Capital now aims to make these opportunities available to the general public using the company’s Silicon Valley Coin (SVC).
Opportunities to invest in traditional VC funds are generally limited to wealthy and well-connected individuals and organizations. Furthermore, investments in venture funds can be locked up for over ten years without the ability to trade or exit. Finally, foreign investors face numerous hurdles before they can invest in US venture funds.
Andra Capital wants to use blockchain technology to solve these problems. The Andra Fund will use blockchain technology, a proprietary investment strategy, world-class partners and a perpetual VC structure with tradeable interests to allow individuals to invest as little as USD 1,000 into a fund that holds stakes in Silicon Valley companies.
The Fund will invest exclusively in private Silicon Valley companies and will be tokenized through a regulatory compliant, asset-backed and tradeable security token called the Silicon Valley Coin (SVC). In other words, SVC token holders will have an ownership interest in the Fund. The value of SVC is backed by the value of the underlying investments in the Fund and SVC can be traded among eligible participants (unlike traditional venture fund investments).
The Fund’s goal is to deliver annualized returns that exceed the Internal Rate of Return (IRR) offered by the top-tier Venture Capital funds. The fund’s investment strategy is simple: invest in the next wave of multi-billion dollar tech companies before they go public or get acquired.
To do this, the Fund plans to target Silicon Valley companies with high growth potential that meet the following criteria:
- Has raised at least two rounds of financing from established venture capital firms;
- Has an enterprise value of at least USD 500 million; and
- Has potential for an exit within 36 months (e.g. through Initial Public Offering or merger/acquisition)
In general, the Fund will allocate around 80% of its capital to the type of late-stage private companies described above. The balance 20% will be allocated to promising early-stage private companies. Andra Capital’s white paper gives the following examples of companies that they may potentially invest in:
Andra Capital’s network consists of top-tier VCs, company executives, entrepreneurs, investors, lawyers, accountants, and bankers, which allows Andra Capital access to these top-tier investments. The company has raised more than USD 500 million in investment commitments and is on track to reach its USD 1 billion target. Commitments have come from traditional investors (institutions, hedge funds, family offices, and individuals) and SVC token holders.
When it comes to underlying token value, a common criticism of many other utility tokens and cryptocurrencies is that they lack intrinsic value and are not backed by verifiable assets. Since SVC is a security token, it does not face this issue since its value will be determined by the Fund’s investments. This important feature should give investors some clarity when valuing the SVC token. An increase in the value of the companies held in the Andra Fund should support the SVC token’s value.
Andra Capital will allocate up to 50% of the Fund’s earnings to repurchasing SVC tokens in circulation. Re-purchased tokens will be withdrawn from the market, which, all else being equal, should increase the value of remaining SVC tokens held by investors.
Team, Advisors and Partners
Andra Capital is headed by a strong core team with rich experience in private investing. According to their white paper, team members have previously closed over three hundred deals, processed over USD 10 billion in private investments, and managed numerous large funds and venture-backed private companies.
Haydar Haba (Managing Partner): A technology enterprise expert recognized for his vision and expertise in the Internet and Telecom industries. Mr. Haba has over 20 years of entrepreneurial experience building successful tech companies that have generated billions of dollars in revenue. Mr. Haba founded and built IntelePeer, Telco 214, and others from inception to exit, raising millions of dollars in Venture Capital.
Dr. Hermann Liu (Managing Partner): An asset management expert who previously co-founded Arbor Ventures, a technology venture fund. He has been investing in financial technology, blockchain, artificial intelligence, and other disruptive innovations. Dr. Liu co-founded Global Financial Technology in China, which attracted investment from the same VC firm that backed Mr. Haba’s IntelePeer. He has also served in various technology and management positions at Charles Schwab and Morgan Stanley.
Ting Louie (Managing Partner): A technology investment expert who brings strong experience in sourcing and executing tech sector investments. Mr. Louie has managed investments and transactions for a multi-billion dollar family office and holding company. Mr. Louie brings extensive experience as a venture capital partner and technology investment banker. He was a general partner at SE Ventures and senior director of business development and investments for the NASDAQ Private Market and Sharespost.
The company’s notable advisors include:
- Wilson Chandra: CEO of TransAccel, a business/market acceleration firm helping technology companies establish and grow their presence throughout Asia Pacific and the US.
- Peter Kuo: CEO of DCLC International Group, a business consultancy.
- Reese Jones: Advisor to Facebook and part of Harvard Medical School’s Genetics Advisory Council.
Andra capital has also partnered with the following organizations:
- DLA Piper (legal counsel)
- Deloitte & Touché LLP (Fund auditor)
- Duff & Phelps (overseeing valuation and compliance)
- Apex Fund Services (fund administration)
For more information on Andra Capital’s team, investment strategy and SVC token, please visit their official website.
Disclaimer: Investing in Initial Coin Offerings, cryptocurrencies, and digital tokens is highly risky and speculative. The material presented here is for information purposes only. This information presented here is not intended to provide any sort of investment advice, nor does it recommend any company, Initial Coin Offering, or digital token and should not be taken as the basis for any investment decision or strategy.