Sustainable Enterprise Fund: Follow-On Investment Pool

In growing each fund to near its capacity there will be a lot of investees.  We can assume a percentage of those will be hot prospects with proven track records and needing follow-on investment.

It is both of great benefit to investees and investors to have funds reserved for follow-on investment.  This pool has the advantage of being already tested investments, thus with lower probable risk and higher probability of returns.

The Follow-On Investment Pool is managed within the Sustainable Enterprise Fund and administered separately by Lellco.  If you would like to participate in the Follow-On Investment Pool please direct your enquiries to Lellco.

Sustainable Enterprise Fund (the Fund)

The FOI Pool will be the exclusive reinvestment pool of the Sustainable Enterprise Fund.

Pool Investment Focus

The FOI Pool will only be permitted to invest into an existing investee of the Fund that has:

1. 1. been a Fund investee for at least 18 months;
   2. demonstrated significant growth, market opportunity and management capability;
   3. a good working relationship with a SMVCF investor, and that demonstrates improved transparency reducing information asymmetry;
   4. a management team and corporate culture that demonstrates high standards of ethics, honesty, and integrity.

Unique Access

The Fund shall require all its investees grant to the FOI Pool the right-to-invest.

This will give the FOI Pool a unique level of access to select from the best and most successful of a large catchment of investments.

Pool Size

The FOI Pool shall be 5% of the maximum capacity of the Fund, therefore $10,000,000 if the Fund has $190million under management.

Commitments

The FOI Pool will accept investment commitments starting at $250,000 and then in multiples of $100,000 up to $3 million per investor.

Manager’s Commitment

The owners and management of Purpose Driven Capital have committed to provide 10% of the Follow-On Investment Pool.

Activation

The FOI Pool shall not be activated until the Fund achieves no less than $50M under management, meaning that no fees are payable and no drawdown on commitments may occur before this time.

Drawdowns

Drawdowns on commitments may not occur until the FOI Pool is activated, i.e., Fund has $50 million under management.

The percent of a commitment that may be drawn down is dependent on the percentage of Fund capacity at that time; for example, a commitment of 20% would be $2 million but if the Fund only has $50 million under management (i.e., 25% of its $200 million capacity) only 25% of the commitment may be drawn, $500,000.

Investment Selection

The managers of the Fund shall select the investments of the FOI Pool.

It is important to remember that potential investments will have been introduced by a SMVCF investor and will have gone through the Fund’s own pre-investment due diligence, including the due diligence material gathered by the SMVCF investor.  This will greatly assist the FOI Pool investment assessment, due diligence, and selection process.

Investment Management

The Fund’s managers will manage the investments of the FOI Pool; however, they will be guided by the introducing SMVCF investor/s as that party is likely to continue managing the original investment (thus we will be piggy backing on that investors success).

Fee Structure

Management Fees

Management fees will only apply once the pool is activated, so no cost for a commitment until we have proven our model with at least $50 million under management.

Carried Interest

Our carried interest fee will be 5% for super funds or 10% for all other investors, but it applies on each investment, without performance hurdles and not net of management fees.

Registration of Interest

Lellco is now open to Registration of Interests to the pool.  If you want to register your interest please let Lellco know and they will contact you to discuss further.