The British Virgin Islands is a popular choice for those wanting to start an investment fund. It is a stable location with a welcoming business, investment, and financial climate, with ample experience in the investment sector. There are a variety of products available, some of which are geared towards beginner investment managers and others that are designed for established investors.
Incubator Fund
A BVI incubator fund is a startup fund for investment managers who want to bolster their track records and portfolios. It is low-cost to set up and does not require significant administrative input. It has a fixed term and should be transformed into another form of the fund at either two or two years plus one.
Maximum assets: $20,000,000
Minimum investment: $20,000
Maximum investors: 20
Life of fund: 2 years with the possibility to extend by one further year upon application.
Offering memorandum: It’s not necessary to offer a memorandum, but an investment warning should be covered in the term sheet.
Authorised representative: Required, but Fast Offshore can provide this service.
Administrator: Not required.
Investment manager: Not required.
Investment advisor: Not required.
Custodian: Not required.
Auditor: Not required.
Financial statements: Yes, but unaudited.
Approved Fund
The approved fund is a step up from the incubator fund. It is low-cost with a low administrative burden but has no limit on terms like the incubator fund. Some with incubator funds will transform them into approved funds, while other investors start with an approved fund. It is cost-effective and helps with establishing a track record.
Maximum assets: $100,000,000
Minimum investment: No requirement for a minimum investment
Maximum investors: 20
Life of fund: No limit
Offering memorandum: It’s not necessary to offer a memorandum, but an investment warning should be covered in the term sheet.
Authorised representative: Required.
Administrator: Required.
Investment manager: Not required.
Investment advisor: Not required.
Custodian: Not required.
Auditor: Not required.
Financial statements: Yes, but unaudited.
Private Fund
A private fund is a mutual fund limited to no more than 50 investors on an “invitation only” basis. It cannot be offered to the public, and it has no limits on life span or the asset value. Unlike incubator and approved funds, it requires audited financial statements to be submitted each year.
Maximum assets: No limit.
Minimum investment: No minimum.
Maximum investors: 50, invitation only.
Life of fund: No limit.
Offering memorandum: Required.
Authorised representative: Required.
Administrator: Required.
Investment manager: Required.
Investment advisor: Not required.
Custodian: Required.
Auditor: Required.
Financial statements: Yes, audited.
Professional Fund
A professional fund is only available to professional investors who are prepared to invest no less than $100,000. It also requires audited annual financial statements.
Maximum assets: No limit.
Minimum investment: $100,000
Maximum investors: No limit.
Life of fund: No limit.
Offering memorandum: Required.
Authorised representative: Required.
Administrator: Required.
Investment manager: Required.
Investment advisor: Not required.
Custodian: Required.
Auditor: Required.
Financial statements: Yes, audited.
Public Fund
A retail product, public funds have a much higher regulatory burden than other funds as a retail product. It must be registered with the FSC before conducting business, and the manager must publish a prospectus that complies with various rules and regulations. This is not a common fund type for our clienst.
Maximum assets: No limit.
Minimum investment: No minimum.
Maximum investors: No limit.
Life of fund: No limit.
Offering memorandum: Required.
Authorised representative: Required.
Administrator: Required.
Investment manager: Required.
Investment advisor: Not required.
Custodian: Required.
Auditor: Required.
Financial statements: Yes, audited.
To discuss your options contact Fast Offshore. We can help you pick the best investment vehicle for your needs and portfolio and take care of the whole set-up process. Additionally, we can assist you in providing some of the required roles necessary to meet the requirements of the BVI authorities.