How we unlock liquidity
Collective Equity is a diversified fund that brings together equity contributions from founders and non‑security assets. The fund raises a non‑recourse facility to distribute capital upfront, repays the loan from early exits, and shares all remaining liquidity pro rata – maintaining ownership, upside, and aligning incentives across the portfolio.
The Process
Fund formation
Collective Equity sets up and manages the fund structure, including the Partnership and General Partner, in Jersey. Founders and shareholders of venture and growth-backed companies, together with owners of non-security assets such as real estate, contribute their equity to the fund.
This combined structure allows contributions to be made on a tax-deferred basis, with all participants becoming limited partners in a diversified portfolio.
Financing & Distribution
The fund secures a loan facility from a credit provider at a 20% loan-to-value (LTV). The proceeds are distributed to limited partners as an LP distribution, which is non-dilutive, non-taxable, and non-recourse.
The facility uses payment-in-kind (PIK) interest, meaning no cash interest or principal repayments are required during the life of the loan, which runs for up to six years. The loan is securitised against the entire portfolio with no individual liability.
Maturity & Exit
The first liquidity events, generated from the intended sale of the non-security assets, or the underlying portfolio companies, are used to repay the loan, including both principal and accrued PIK interest.
Once the loan is fully repaid, proceeds from subsequent liquidity events are distributed pro rata to the founders, as limited partners of the fund. Collective Equity participates in 15% of all liquidity distributions.
Comparison to secondaries
Same starting point
- Anthony and Emma are founders of successful growth companies selling 10m of stock.
- Each wants 1.5m of cash today, and to remain exposed to high-growth upside.
equity to sell
Traditional Secondary
equity to contribute
Collective Equity
Initial transaction
- After a 15% secondary discount, capital gains tax, and 1.5m to spend, Anthony is left with 5m to reinvest in VC. Voting rights and future upside on all sold shares are lost.
- Emma contributes 10m of shares into the Collective Equity portfolio and receives 1.5m day-one cash to spend, tax deferred. Voting rights and participation in future upside are retained.
to reinvest
Traditional Secondary
to reinvest
Collective Equity
Compounding advantage on 3× return
- After management fees (2% annually, stepping down to 1.5% after year five), 20% carried interest on profits, and taxes, Anthony has a 10.7m net cash return, including the initial cash.
- After debt and interest repayment (~3m), a 15% performance fee, and taxes, Emma has a 18.5m net cash return, including the initial cash.
Collective Equity gives an advantage of ~7.8m on net cash return.
net cash return
Traditional Secondary
net cash return
Collective Equity
Let's dive into the numbers
The example shown is for illustrative purposes only. It does not represent actual or projected terms or returns and should not be relied upon for investment decisions. The value of investments can go down as well as up, and investors may lose some or all of the capital they invest. Private company shares are illiquid and valuations may be uncertain. Past performance is not a reliable indicator of future results. Venture capital funds commonly use fee models consisting of a 2% annual management fee and 20% carried interest (BVCA, 2025). Terms may be subject to change.
equity to sell
to reinvest
net cash return
Traditional Secondary
equity to contribute
to reinvest
net cash return
Collective Equity
Onboarding process
We deliver a light-touch process from onboarding to participation.
NDAs signed & review pipeline
Dataroom & due diligence
Investment Committee & lender approval
Board approval, KYC & AML
Welcome to the fund!
Investment committee
