The problem with most listed players is that only the management vehicle is listed. The funds themselves, with which the investments are made, however, are not. This means that you usually participate only or at least mainly in the management fee (which in turn depends on the AUM). This could be compared to buying Blackrock shares but not Blackrock funds (Blackrock funds are listed on the stock exchange because they only invest in listed companies). The funds themselves are closed-end funds with mostly 10 years maturity and at least for Otto-Normalverbraucher not directly drawable, because the minimums are mostly 5-10 million (with the big known VC or PE investors sometimes even higher). That's why I make all my private equity and VC investments via feeder providers like Moonfare or Finvia (Liqid also exists, or fund of funds providers like Astorius Capital). There you can - as a semi-professional investor - usually be involved from 100k. However, I don't know of any funds that are purely specialized in AI, since a certain diversification is desirable. If one would bet only on AI, and the timing would turn out to be wrong in retrospect (as if one would have bet on e-mobility in 2010, for example), they would not be able to raise a follow-on fund in case of bad development.
•
11
•
1Anno
@Investorentagebuch Thanks for your interesting reflections. Do you still know CMGI from the 90s? How did it go there?
•
11
•@Epi I started investing in '99, just before the bubble burst. Heard the name before, but couldn't place it anymore. Just googled it, possibly they did it from their own balance sheet. But the typical VC funds like Sequoia, Accel, Kleiner Perkins and like they are called usually set up closed funds with 10 years term (+ e.g. 2 years extension option, if in the 9th year an event like COVID happens and you can't make good exits). It is the same with PE companies, even if they have listed management vehicles like KKR, Blackstone or EQT. What I like about this typical structure is that it is easier to align the interests of all parties involved over a period of 10 years (investors, fund management, management of portfolio companies, it is like a 400m sprint). Also, the investment team has to invest a not insignificant part of their own money in the respective fund, and carry (profit sharing) is only given when the hurdle of mostly 8% is reached.
•
11
•1Anno
@Investorentagebuch If I remember correctly, CMGI bought a majority stake in various Internet companies, then financed them, built them up and subsequently floated their shares on the stock market. Profits rose accordingly, especially during the IPO hype. In 1992-2000, CMGI rose 100,000%.
•
11
•