How the Investment Platform Works

Mainspring’s Investment platform is a flexible investment solution for GPs looking for ways to efficiently offer investors or staff a way to invest either into a fund or as co-investment into specific deals.

Stephen Geddes

Investment Platform

The investment Platform offers a low-cost alternative to existing frequently slow, cumbersome and expensive solutions.

Mainspring’s award-winning managed account Investment Platform is inherently flexible and can be used by a GP to manage a number of investors on an individual basis to invest into a number of different investments.

The solution is highly automated through our technology platform and provides each investor access through the portal to their own personal deal by deal portfolio of investments.

How the platform can be used

Challenge

GPs often have demand from investors to invest on a deal by deal basis alongside the main fund, but the administration can be demanding.

Mainspring’s Solution

The GP, using the Investment Platform, is able to offer single, or many, investors the ability to invest into specific deals alongside the main fund.

Outcome

The GP has enabled further funding from multiple investors on a deal by deal basis, alongside the main fund, but without the same level of administrative complication, and with the benefit of easy access to information via the portal.

Challenge

Some GPs prefer not to admit natural persons as investors into limited partnership funds or do not want large numbers of small investors in their fund.

Mainspring’s Solution

By operating a segregated managed nominee structure, individual investors can invest through the Investment Platform, with Mainspring’s nominee becoming a limited partner in the main fund.

Outcome

High net worth and sophisticated investors can, subject to complying with regulatory provisions, gain access to the underlying fund and the GP can benefit from the value they bring.

Challenge

The high minimum investment level for many PE funds can be prohibitive for individual investors.

Mainspring’s Solution

By setting up a dedicated master account for the GP fund, investors benefit from aggregated subscriptions to make such investments and so meet the minimum investment level.

Outcome

The GP can offer access to its fund to a broader range of investors and the investors can invest into a wider selection of funds and will have immediate access to reporting via the investor portal.

Challenge

Often GPs like to incentivise their staff by allowing them to invest in individual deals, but this can be structurally hard to achieve and administratively complex to manage.

Mainspring’s Solution

The GP’s staff commit to a co-investment account. Funds are drawn as deals are completed and Mainspring Nominees invests funds under the GP’s direction, and holds the assets on behalf of the GP’s staff.

Outcome

The GP has an easily managed staff incentive structure with personal accounts for each staff member, who can access investment records via the portal.

Challenge

A portfolio company requires additional financing but the fund is unable to participate, for example, due to concentration limits.

Mainspring’s Solution

The GP is able to group LPs or new investors together in a simple structure that is quick to facilitate investment in the portfolio company while retaining full control.

Outcome

The GP can continue to support the portfolio company and can increase funds under management and fee income.

Challenge

GPs are interested in having some individuals as LPs but there can be concern about liquidity and timeliness of funding drawdowns.

Mainspring’s Solution

GPs can draw down from investors as required into the Investment Platform and hold investor’s monies in the structure, for subsequent drawdown into the main fund, when required.

Outcome

The GP has certainty of available cash, without impacting the IRR, until funds are drawn into the main fund.

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Advantages of the platform for GPs

Less expensive than formal fund structures or SPVs;
Quick, easy and inexpensive to establish;
For either single or multiple investors;
Can hold multiple investments;
Operationally light touch, tried and tested;
High quality bespoke reporting;

Investors have online access to all their investment information;
No tax at the level of the Investment Platform;
No formal audit required;
Carry can be structured as a share of profits or allocation of investments;
No VAT on fees, as custody is tax-exempt.

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Investment Platform

How the platform can be used

Challenge

Mainspring’s Solution

Outcome

Challenge

Mainspring’s Solution

Outcome

Challenge

Mainspring’s Solution

Outcome

Challenge

Mainspring’s Solution

Outcome

Challenge

Mainspring’s Solution

Outcome

Challenge

Mainspring’s Solution

Outcome

Advantages of the platform for GPs

Investment Platform Insights

The new flexible Mainspring Investment Platform

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Are HNW Investors a GP’s new best friend?

Investment Platform News

Can a Fund Manager make investments before a fund closes?

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