The tech secondaries category
Imagine a start-up company as a race car: technology is the engine, seasoned management provides the design, and the founder is in the driver’s seat. But the technology race is a long-term journey, which can last over a decade from start-up founding to exit. You cannot reach the finish line solely on fuel. Oil will need changing perhaps the wheels as well. Think of the VC money as the fuel for the startups, secondary transactions provide the oil to keep the race car at top speed.
ISF’s secondary transaction model allows existing stakeholders to sell a portion or all of their interests in tech companies or venture funds. An entrepreneur or early investor may sell a portion of their stake to realize a part of the value they have created, while focusing on long-term growth. Similarly, a Limited Partner in a Venture Fund may wish to see early liquidity or manage their asset allocations. Our involvement aligns and reinforces the components of the engine and enables the race-car to stay ahead of the pack.
Our investment focus
Our investments cover 3 types of transactions:
The Full Secondary Spectrum
ISF acquires shares, warrants or other financial instruments in growth stage Israel-related tech companies and portfolios. Sellers include funds, investors, founders, management and employees. Following the initial transaction, ISF becomes a long-term partner to the portfolio companies, working with management to conduct additional secondary transactions and participating in future funding rounds. Deal size is typically $1M and above.
Limited Partners’ Positions
ISF acquires Limited Partnership interests in Israel related VC & PE funds with diversified portfolios. We tailor the transaction to suit the requirements of the sellers and assume remaining future capital commitments. We are able to lead transactions of any size.
Structured and GP Led Secondaries
ISF works with GP’s to provide additional capital to funds and provide early liquidity to the LP base. We provide customized preferred equity transactions to allow LPs to accelerate cash returns, while maintaining long term upside and relationships in a fund.