Survey on access to sophisticated and retail investors

A significant proportion of private equity fundraising comes from investors that are not considered “institutional” (i.e.: that are neither pension funds, insurers, banks or soveriegn wealth funds). High net worth individuals represent a significant source of capital, in particular in the venture end of the market. However these investors continue to be treated as retail ones under EU law and, despite their level of sophistication, are subject to additional requirements designed to protect based on its perceived level of inexperience.

Meanwhile, the last few years have seen an increased interest globally towards opening the marketing of private equity funds beyond sophisticated investors. Recent regulatory changes in various jurisdictions have also enhanced private equity managers’ ability to access retail savings – either by lifting restrictions or by offering tax incentives to retail investments on equity markets.

At EU level, the opening of capital markets to retail investors is one of the key workstreams of the Capital Markets Union, with expected suggestions to revise the ELTIF framework and impulsions towards the creation of a new category of semi-professional investors in MiFID. The Commission will also adopt in Q4 2021 a retail strategy “that puts the [retail] investor at the heart of its policies”

In that context, Invest Europe would like to invite you to fill out a survey where you can describe your appetite to market to non-institutional investors of all sorts in order to help determine what actions it should take in this field in the coming months and years.

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* 1. Are you fully AIFMD authorised ?

Yes, I manage more than €500 million

Yes, I manage more than €100 million and am deemed leveraged

Yes, I manage less than €100/500 million but decided to opt-in

Other (please specify)

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* 2. What types of funds are you marketing ?

Venture or growth funds

Generalist funds

Buy-out funds

Funds of funds

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* 3. To what types of investors are you marketing directly ?

I am solely marketing to professional investors

I am also marketing to high net worth individuals

I am also marketing to family offices

I am also marketing to other types of knowledgeable investors (e.g.: academic institutions, etc)

I am also marketing to “pure” retail investors (i.e.: investors that commit less than € 100.000 in the fund)

If you are marketing to pure retail investors or other types of investors, please detail their type and nature

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* 4. What are the reasons that could/ are preventing you to market to sophisticated investors ?

	Not at all an important factor	Not so important factor	Somewhat important factor	Very important factor	N/A
I am able to raise sufficient capital from institutional investors	I am able to raise sufficient capital from institutional investors Not at all an important factor	I am able to raise sufficient capital from institutional investors Not so important factor	I am able to raise sufficient capital from institutional investors Somewhat important factor	I am able to raise sufficient capital from institutional investors Very important factor	I am able to raise sufficient capital from institutional investors N/A
National laws only allow me to market to institutional investors	National laws only allow me to market to institutional investors Not at all an important factor	National laws only allow me to market to institutional investors Not so important factor	National laws only allow me to market to institutional investors Somewhat important factor	National laws only allow me to market to institutional investors Very important factor	National laws only allow me to market to institutional investors N/A
Complying with KID requirements is too demanding/too expensive	Complying with KID requirements is too demanding/too expensive Not at all an important factor	Complying with KID requirements is too demanding/too expensive Not so important factor	Complying with KID requirements is too demanding/too expensive Somewhat important factor	Complying with KID requirements is too demanding/too expensive Very important factor	Complying with KID requirements is too demanding/too expensive N/A
Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify)	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Not at all an important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Not so important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Somewhat important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Very important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) N/A

Other (please specify)

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* 5. Are you planning to market to "pure retail investors" in the future ?

Yes, in the near future

Yes, I will consider it at some point

No, this is not something that I find interesting

Other (please specify)

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* 6. What are the reasons that could/ are preventing you to market to pure retail investors ?

	Not at all an important factor	Not so important factor	Somewhat important factor	Very important factor	N/A
I am able to raise sufficient capital from institutional investors	I am able to raise sufficient capital from institutional investors Not at all an important factor	I am able to raise sufficient capital from institutional investors Not so important factor	I am able to raise sufficient capital from institutional investors Somewhat important factor	I am able to raise sufficient capital from institutional investors Very important factor	I am able to raise sufficient capital from institutional investors N/A
National laws prevent me to market to pure retail investors directly	National laws prevent me to market to pure retail investors directly Not at all an important factor	National laws prevent me to market to pure retail investors directly Not so important factor	National laws prevent me to market to pure retail investors directly Somewhat important factor	National laws prevent me to market to pure retail investors directly Very important factor	National laws prevent me to market to pure retail investors directly N/A
Complying with KID requirements is too demanding/too expensive	Complying with KID requirements is too demanding/too expensive Not at all an important factor	Complying with KID requirements is too demanding/too expensive Not so important factor	Complying with KID requirements is too demanding/too expensive Somewhat important factor	Complying with KID requirements is too demanding/too expensive Very important factor	Complying with KID requirements is too demanding/too expensive N/A
Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify)	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Not at all an important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Not so important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Somewhat important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) Very important factor	Complying other national or EU regulatory obligations is too demanding/too expensive (please clarify) N/A

Other (please specify)

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* 7. Do you have to produce a KID (Key Information Document)?

Yes

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* 8. Do you believe the KID is a worthwhile document for your investors in light of their experience (i.e.: do they feel more protected?) ?

Yes

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* 9. On a scale from 1 to 10, how hard is it for you comply with the following KID requirements ?

	1	2	3	4	5	6	7	8	9	10
Determining and calculating the risk indicator	Determining and calculating the risk indicator 1	Determining and calculating the risk indicator 2	Determining and calculating the risk indicator 3	Determining and calculating the risk indicator 4	Determining and calculating the risk indicator 5	Determining and calculating the risk indicator 6	Determining and calculating the risk indicator 7	Determining and calculating the risk indicator 8	Determining and calculating the risk indicator 9	Determining and calculating the risk indicator 10
Preparing performance scenarios	Preparing performance scenarios 1	Preparing performance scenarios 2	Preparing performance scenarios 3	Preparing performance scenarios 4	Preparing performance scenarios 5	Preparing performance scenarios 6	Preparing performance scenarios 7	Preparing performance scenarios 8	Preparing performance scenarios 9	Preparing performance scenarios 10
Calculation of the costs	Calculation of the costs 1	Calculation of the costs 2	Calculation of the costs 3	Calculation of the costs 4	Calculation of the costs 5	Calculation of the costs 6	Calculation of the costs 7	Calculation of the costs 8	Calculation of the costs 9	Calculation of the costs 10

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* 10. How useful would you find it if a KID would no longer be required for marketing to

	Not at all useful	Not so useful	Somewhat useful	Very useful		N/A
sophisticated investors (investors committing more than €100.000)	sophisticated investors (investors committing more than €100.000) Not at all useful	sophisticated investors (investors committing more than €100.000) Not so useful	sophisticated investors (investors committing more than €100.000) Somewhat useful	sophisticated investors (investors committing more than €100.000) Very useful	sophisticated investors (investors committing more than €100.000)	sophisticated investors (investors committing more than €100.000) N/A
retail investors	retail investors Not at all useful	retail investors Not so useful	retail investors Somewhat useful	retail investors Very useful	retail investors	retail investors N/A

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* 11. Do you believe Invest Europe should take a greater interest in the “retailisation” of the industry ?

Yes, by advocating for the ability of managers to more easily market directly to retail clients

Yes, by advocating for the ability of managers to have a better access to new pools of capital

No, I believe Invest Europe should focus on traditional marketing to sophisticated and professional clients

Please comment

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* 12. Would you be willing to complement this survey with a 15 to 20 minutes conversation with Invest Europe? If yes, the Invest Europe Public Affairs team may contact you individually

Yes

Please leave here an email if you would like us to contact you