1. When will this offering close?
Stableton Unicorn Top 20 Fund is an evergreen fund with an open-ended structure. They are currently open for subscriptions with monthly closes. The cut-off date for commitments from Alta is as follows:
2. Why should investors invest through Alta Unicorn Access Fund instead of going directly to the Stableton Unicorn Top 20 Fund?
Investors accessing the opportunity through Alta Unicorn Access Fund will benefit from the following access and liquidity benefits for investors of all ticket sizes:
Access:
- Fractionalisation ticket size to US$25k minimum, compared with minimum EUR100k equivalent in USD that investors have to meet into order to subscribe to if they go direct to Stableton
- Small tickets subscribers accessing the Fund direct may have to pay up to 6% in sales charge if they enter directly through Stableton. Through Alta Unicorn Access Fund, we will only layer up to 3% subscription fees
- Investors above the Fund's minimum ticket (i.e. EUR equivalent of 100k) will face the same management fee terms compared with going direct to Stableton.
Liquidity:
-Post-subscription and subject to feasibility in liquidity and demand, Alta may potentially tokenise and list the participating shares of Alta Unicorn Access Fund on Alta Exchange as a digital listing.
-The tokenised listing potentially provides investors with a path to liquidity to exit the Stableton Unicorn Top 20 Fund, as investors would not be restricted by lock-up periods and redemption notice and redemption windows that they would adhere to under a conventional redemption process.
3. What is the current composition of the Stableton Unicorn Top 20 Fund?
As at end Oct 2024, Stableton Unicorn Top 20 Fund has successfully deployed into 18 of the 20 target portfolio companies, with the exception of xAI and Rippling, which Stableton is planning to include. The respective weights of the Fund holdings is as follows:
As the Fund was recently launched in Apr 2024 and given the relatively illiquidity of the private markets compared to public markets, Stableton is in the midst of adjusting its portfolio towards a target weight of 5% per company. For Canva specifically, an over-allocation was taken in order to secure an attractive position in a company where direct investments at the cap table are not easy. This position will be normalised as the fund increases its AUM and rebalancing management from Stableton, which may include reducing this position by offering it as a co-investment deal.
4. How often is the Fund portfolio and Morningstar Pitchbook Unicorn Select 20 Index rebalanced?
The index is reconstituted (where required) and rebalanced on a quarterly basis, with the next rebalancing window due to complete on 23 Dec 2024.
5. Are the liquidation events distributions or are they held as cash holdings?
All share classes in the Fund are accumulation share classes. Therefore, any potential upside from liquidation event(s) shall be embedded in the net asset value of the prevailing share class.
6. Can you please share a breakdown of the fees and holding structure for this investment
We are currently in the midst of establishing an SPV for investors to access the fund opportunity. The SPV will be via a VCC sub-fund/or similar structure that will be directly deployed into subscriptions into Stableton Unicorn Top 20 Fund.
The indicative fees and costs are as follows:
- Subscription Fee: Up to 3.0% on the committed amount for commitments below US$1.0M. We are currently offering an early bird rate of 2.0% subscription fee.
- Management Fee:
- 1.85% per annum for investments of US$100k or more;
- 2.15% per annum for investments below US$100k
We are collecting the management fee upfront for the first year, with subsequently management fee being accrued monthly and payable monthly in arrears.
- Performance Fee: Nil
- Fund Expenses (deducted from NAV of SPV): 2.5% upfront for 5 years (0.50% per annum)
7. Fees Breakdown
Illustration
- Investor Commitment: $100
- Sub Fee: +$2
- Subscription fee of 2% is charged based on the subscription amount
- Subscription fee is charged on top of the subscription amount
- Management Fee (2.15% p.a): +$2.15 (1yr upfront)
- Also collected on top of the subscription amount.
- Total amount paid by the investor= $102 + $2.15 = $104.15.
- Fund Expenses (5 years upfront): -$2.5
- Deducted from the base NAV ($100).
- NAV after fund expenses: $97.5
8. For the Stableton Unicorn Top 20 Fund, does it has SGD shares class and what is the minimum investment? Is this an open ended fund that I can redeem over monthly windows? Is there a lockup period?
There are currently no available SGD share classes at both the fund (USD, EUR and CHF) and proposed Alta sub-fund (USD) level, although we may consider setting up one in future should there be sufficient commercial considerations for this. The minimum ticket for deployment via the sub-fund is currently at US$25,000.
For added information on the timeline, we are targeting to deploy the first phase of commitments in the Feb 2025 close, with the cut-off date for commitments by 27 Jan 2025. There will be monthly windows where investors can subscribe to the fund thereafter.
Yes the fund is open ended, with quarterly redemption windows (excl. 90day notice period) after a 12 month lockup period.
As one of the key features for investing through Alta, investors potentially have a path to liquidity during the lockup period through our digital exchange.
9. How does Stableton monetize all portfolio companies, calculate the overall NAV, and what are the fund mechanics?
Stableton invests systematically in the top 20 private, venture-backed unicorns via various channels in the private markets, benefiting from the potential gap in valuation between private markets and M&A/public markets as the basis of potential upside in the Fund
The NAV is determined monthly based on mark-to-market valuations, leveraging data from sources like Morningstar and secondary market valuation. This ensures transparency and alignment with market movements.
Monetisation of the portfolio companies will be largely from liquidity events (mostly M&A or IPO), which the majority of the portfolio is primed for given the late stage growth nature of their operations.
10. What is the holding period for each portfolio company, and how will Stableton cash in?
The typical holding period for the portfolio will be dependent on the construction of the index. Should there be a reconstitution in the index portfolio, Stableton will revise the Fund portfolio accordingly to include the reconstituent.
Stableton will benefit from liquidity events (M&A or IPO) which may occur to the portfolio companies during the lifespan of the Fund.
11. What is Stableton’s exit strategy?
The Fund is designed as an open-ended, evergreen fund vehicle. Any exit(s) from a portfolio company will be based on the prevailing index portfolio as constructed by Morningstar Indexes.
For investors, the Fund units are accumulation in nature, investors may divest part/all of their unit holdings and capitalise its returns based on the potential movements in net asset value of the Fund upon their targeted exit.
12. How will Stableton generate returns for investors? Will they wait for portfolio companies to go public?
For investors, the Fund units are accumulation in nature, investors may divest part/all of their unit holdings and capitalise its returns based on the potential movements in net asset value of the Fund upon their targeted exit.
The construction of the portfolio will be based on the prevailing index portfolio as constructed by Morningstar Indexes. The timing of exit from the portfolio companies will therefore depend on the prevailing constituent portfolio.
13. Possible to do 2.5k for 10 months?
The minimum ticket for deployment via the sub-fund is currently at US$25,000. The fund does not currently offer an installment payment plan.
Currently we are targeting to deploy the first phase of commitments in the Feb 2025 close, with the cut-off date for commitments by 27 Jan 2025. There will be monthly windows where investors can subscribe to the fund thereafter.
14. Do I need to pay a subscription fee every year? What if I subscribe more than once - do I need to pay the subscription fee again for the following month? How much do I need to pay for the fees every year after year 1? Is it subscription fee + management fee?
The subscription fee is a one-time fee applied at the time of each subscription, including any incremental subscriptions.
After the first year, only the management fee will be payable, which will be deducted from the net asset value position of your unit subscription.
15. Where is the fund going to be domiciled? Can we have a better understanding of the taxation at fund and individual level ? What all will be the applicable taxes ?
The fund is domiciled in Luxembourg and established as a SICAV-RAIF (investment company with variable capital).
Regarding your query on taxation at fund level, you may refer to Section 26: Taxation Considerations Relating to the Company in the Confidential Offering Memorandum (First Amended and Restated) in Jun 2024 for the relevant disclosures about the tax considerations, including: withholding tax, corporate income tax, municipal business tax and net wealth tax etc.
As for taxation at the Alta sub-fund (to be established), the Fund will be established as a sub-fund under an umbrella Variable Capital Company, which will intend to apply for and rely on the Tax Exemption Scheme under Section 13O of the Singapore Income Tax Act. We will share more details about the tax considerations of the sub-fund once it has been established.
We are unable to comment on the taxation at individual level, and would recommend that you seek independent advice regarding the matter.
16. What is the difference between management fee and fund expenses ? Looks like these are two separate heads over and above the subscription fee which needs to be paid to Alta.
The Management Fee is charged by Stableton (1.85%) for managing the portfolio, including investment selection, monitoring, and fund administration. For the Alta sub-fund to be established, there is an additional charge of 0.30% (i.e. total fee of 2.15%) by Alta for investment commitments below US$100,000 for services rendered on the aggregation and administrative for the subscription. We are only collecting the management fee upfront for a period of 1 year, as subsequent years’ management fees will be deducted directly from the net asset value of the units held by the investors.
The fund expenses applicable in Alta’s subfund is a one-time upfront costs charged by Alta, covering administrative, structuring, legal, regulatory, and operational expenses related to the establishment and maintenance of the sub-fund.
We have been very mindful of ensuring that our investors are able to access the Stableton opportunity across ticket sizes at competitive terms. As you may note from the Stableton PPM, the Class C (USD) sales charge shall be at up to 6.0%, while access through Alta (subscription fee + upfront fund expenses) is only ~4.5%.
17. Is the NAV of the fund calculated using valuation at last capital raise or at secondary implied valuations?
The Net Asset Value of the units shall be computed by the Administrative Agent based on the difference between the gross assets (i.e., the aggregate value of all assets of the Fund and including the fair value of Investments owned by the Fund and its Intermediary Holding Vehicles) and the liabilities of the Fund.
The Investments are determined based on the fair market value of the assets (if unlisted) in accordance with methods and assessments agreed between the AIFM and the Stableton General Partner of the Fund as most conducive and in accordance to the valuation policy of the AIFM.
Based on the Factsheet provided, Stableton currently obtains data points of its implied secondary valuations of Fund’s underlying private companies from Caplight, a US-based platform that provides the settlement of derivative transactions relating to stock in private market companies.
18. The provided management fee and fund expenses are for the Alta sub-fund? i.e. these are in addition to the charges that are levied by Stableton?
The Management Fee charged by Alta’s sub-fund includes the portion of the Management Fee charged by Stableton (1.85%). for managing the portfolio, including investment selection, monitoring, and fund administration. For the Alta sub-fund to be established, there is an additional charge of 0.30% (i.e. total fee of 2.15%) by Alta for investment commitments below US$100,000 for services rendered on the aggregation and administrative for the subscription. We are only collecting the management fee upfront for a period of 1 year, as subsequent years’ management fees will be deducted directly from the net asset value of the units held by the investors.
The fund expenses applicable in Alta’s subfund is a one-time upfront costs charged by Alta, covering administrative, structuring, legal, regulatory, and operational expenses related to the establishment and maintenance of the sub-fund.
We have been very mindful of ensuring that our investors are able to access the Stableton opportunity across ticket sizes at competitive terms. As you may note from the Stableton PPM, the Class C (USD) sales charge shall be at up to 6.0%, while an access through Alta’s sub-fund (subscription fee + upfront fund expenses) is currently only ~4.5%.
19. Noted on the fund expenses. Then what is the subscription fee? If Alta sub fund is already charging me upfront 2.5% as fund expenses for 5 years, what is the rationale for subscription fee? Is it purely Alta's profit ?
The subscription fee is a one-time fee charged by Alta in its capacity as the marketing and distribution platform for the Stableton opportunity. This fee reflects the effort involved in securing access to the deal opportunity at favorable rates, including the waiver of the sales charge that Stableton typically imposes on its investors for accessing the fund through Class C shares. Additionally, it covers the work done in conducting due diligence on the opportunity.
Our sub-fund structure is designed to provide more accessible entry points and competitive fees for investors. For instance, while Stableton requires a minimum investment of US$100k, Alta allows investments starting from US$25k, making it more accessible.
As mentioned previously, the combined one-time subscription fee and fund expenses total 4.5%, which is lower than the up to 6.0% sales charge investors would face when going directly to Stableton via the Class C share class.
Here is a ballpark comparison of the one-time fees between Alta sub-fund access and direct access to Stableton:
20. May I check what is the liquidity of this investment? Is there a lock up period?
I noticed that the fund fees are collected 5 years in advanced. Is this the holding period?
Lock-up & Liquidity: The fund has a 12-month lock-up, after which redemptions are available quarterly with a 90-day notice period.
Fund Fees & Holding Period: The 5 years of fees collected upfront is not a holding period but covers administrative, structuring, legal, regulatory, and operational costs to maintain the Alta sub-fund.
Liquidity Pathways: Liquidity for the fund itself depends on M&A or IPO events within the portfolio, which may occur over the fund’s lifespan. However, through Alta, there is a potential alternative liquidity option—subject to demand and feasibility, Alta may tokenise and list participating shares on Alta Exchange, allowing investors an additional exit route outside of the standard redemption process.
21. What happens when there is a liquidation event for one of the companies? Does the fund reduce the holding to 19 companies or does the fund try to add one more company to maintain 20 holdings?
The Fund has partnered with Morningstar to develop the Morningstar Pitchbook Unicorn Select 20 (the “Index”). The Index is reconstituted (where required) and rebalanced on a quarterly basis, with the next rebalancing window due to complete on 23 Dec 2024. Please refer to the following link to the Index here.
Should there be a liquidation event, the Index will be reconstituted at the next available period. Accordingly, the Fund shall also rebalance and adjust its holdings to match the constituent companies in the Index.