Brendan Lyons

Perennial is pleased to announce the launch of a new private growth ventures fund.

The Perennial Private Ventures Fund will open to wholesale investors on 26 April 2022. Pre-marketing for the new fund has already commenced, with strong initial interest and cornerstone capital already identified. The target raise for the new fund is $200m+ from a mix of wholesale private investors, family offices and super funds.

The fund will offer investors access to high growth private businesses located primarily in Australia. The fund will leverage Perennial’s experience and track record in private company investing via its existing funds in this rapidly growing sector of the market.

Portfolio Manager Ryan Sohn said: “The Perennial Private investment team is seeing a rapidly increasing pipeline of high-quality growth stage private companies. These companies are staying private for longer, and this drives the need for patient institutional capital which this new fund will help supply. Perennial is uniquely positioned to partner with the very best founders and companies on their complete journey.”

Investment strategy

The Perennial Private Ventures Fund will target the high returns of early-stage venture capital, but with a faster route to liquidity and lower overall portfolio risk. This will be achieved through a combination of layered portfolio management, deal structuring, value discipline, and a proactive management style regarding the fund’s investments.

Ryan Sohn said: “There is an increasing gap in the domestic market at the private growth stage – the new Perennial Private Ventures Fund is solving for this. There has been increased activity in early stage investing in Australia, however this market has now evolved, and these companies are increasingly looking for institutional capital to help drive the next stage of their private growth strategy.” 

Strong track record in Private Growth Stage Investing

Perennial has a strong track record of deploying capital into private markets, including the Private to Public Opportunity Funds (PPP) and the Perennial Value Microcap Opportunities Trust. Perennial has partnered with many successful private companies including Koala, Animoca Brands, Spriggy,  Indebted, Emesent, Xpansiv, Sonder and Songtradr.

Brendan Lyons, Portfolio Manager and Head of Private Investments, said: “Perennial has invested in over 80 private companies in the last five years, and a third of these have now transitioned to IPO or private takeover. The Perennial Private investment team has deep experience in both private and public markets as well as managing corporate transactions.”

The first Perennial Private to Public Opportunities Fund (PPP1) launched in August of 2019 and has returned +169% (net of all fees) since inception or a 2.7x net multiple on invested capital as at the end of January 2022.

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Brendan Lyons

Perennial’s Private to Public Opportunities Fund No.3 (PPP3) has closed its capital raising fully subscribed – attracting $200 million from a wide range of wholesale investors.

PPP3 will employ the same investment strategy as Funds 1 and 2. It will target superior returns from an actively managed portfolio of up to 35 positions in private companies and pre-IPOs, plus investments in direct IPOs and discounted placements, over a five-year period. Perennial now manages over $500m in this private investment strategy.

Head of Perennial Private Investments, Brendan Lyons, said: “We appreciate the strong support from investors for PPP3, with many wealth groups, family offices and individuals following on from our earlier PPP funds. We are very pleased to reach the maximum target fund size of $200 million for our third fund in this exciting and expanding sector of the equity market.”

Mr Lyons said investors had been supportive of the fund’s investment process, which focuses on the Last Private Offer (LPO) undertaken by founder-led companies prior to an IPO or other liquidity event.

“Our systematic filtering process, coupled with a large and growing pipeline of private opportunities, provides a diversified investment exposure which is otherwise difficult to access,” he said.

The growing opportunity set has resulted in two new hires into the PPP team. Karen Chan recently joined as Senior Investment Director based in Sydney, with James McQueen adding his legal and execution skills to the PPP team from Melbourne.

Perennial has already identified several private company and pre-IPO investments for PPP3, with the deployment of capital to commence immediately.

Portfolio Manager Ryan Sohn commented: “We are really excited at the prospects of the companies that PPP3 will be invested in. Two of our initial investments are digitised debt collection business Indebted and music platform Songtradr. Both are founder-led global businesses with large markets, fast revenue growth and unique intellectual property.”

Over the past 18 months, the PPP funds have experienced 14 IPOs plus one takeover within the portfolio of private companies. Some of these names include Booktopia, Aussie Broadband, Lumos Diagnostics and Spire Global.

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Andrew Smith

Perennial’s Private to Public Opportunities Fund No.2 (PPP2, the Fund) has closed its capital raising fully subscribed – attracting $125 million from a wide range of wholesale investors.

PPP2 will invest in high-growth equity opportunities through an actively managed portfolio of 30-45 unlisted, pre-IPO and listed Australian companies.

The launch of the second PPP fund by Perennial follows the success of its first private companies fund PPP1, which has delivered a total return of 31.1%[1] net of fees since inception in August 2019 (including a 5% distribution in July 2020).

PPP2 will employ the same investment strategy as its predecessor fund, with the aim to generate superior returns over a five-year period.

Head of Smaller Companies and Microcaps, Andrew Smith, said “We appreciate the support from investors for our initial PPP fund, as well as the strong demand experienced for PPP2. We are very pleased to reach the maximum fund target size of $125 million for our second PPP fund.”

According to Head of Private Investments, Brendan Lyons, investors have been supportive of the Fund’s investment strategy, which focuses on the Last Private Offer (LPO) undertaken by founder-led companies prior to an IPO or other liquidity event. “Our systematic process, coupled with a large and growing pipeline of private opportunities, provides a diversified investment exposure which is otherwise difficult to access. In addition, increased volatility in global equity markets this year has prompted many investors to seek out alternate sources of return,” said Mr Lyons.

The Perennial team has already identified several private and pre-IPO investments for PPP2, with the deployment of capital to commence immediately. Deputy Portfolio Manager Ryan Sohn commented “We are really excited at the prospects of the companies that PPP2 will be invested in. Two of our initial investments include an e-commerce businesses with significant scale as well as a health technology company with unique IP. We have followed the growth of these businesses for a significant period of time and are delighted to now be part of the journey with them”.

Some of the businesses the first PPP fund invested in include soft tissue regeneration business Aroa Biosurgery, diagnostic testing business Atomo Diagnostics and lung imaging technology firm 4D Medical – all of which have successfully listed on ASX this year.

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