Dani Sullá, account director of Trea AM, talks about the Trea US Venture fund that the manager has just launched together with The Fund, by guru Scott Hartley. The strategy involves investing in early-stage American startups, with the goal of multiplying the money by 3, 4, or 5 times in seven or ten years.
Why invest in American startups instead of European ones right now?
More than saying American instead of European, because they are complementary, what we are saying is that the US, having a smaller population than the EU, created more than 500 unicorns (startups valued at more than 1000 million), which is double what What did the whole EU do? When we talk about innovation, the economic engine, culture, tradition and market size, the US is the market to be in; any investor who wants to have exposure to venture capital, the US is mandatory. On the other hand, we detected that here the market had an overexposure in local funds (European Spanish), or, in global issues, in funds of funds. Our fund allows direct exposure to the US.
Who is the Trea US Venture fund that has just been launched by The Fund, by guru Scott Hartley, directed at and for whom?
The fund is aimed above all at the institutional public, but also at the final or retail public. The institutional public is obvious: they are qualified entities with capital budgets, a lot of financial knowledge (insurance companies, pension plans, funds of funds, for example). But the novelty of this fund is that, being a Spanish FCR, it can give entry to unqualified investors (retail or retail), which we see can fit into the private banking segment, taking into account that in the end they are tickers of 100,000 euros for get in. There is also a new law that allows smaller tickers, as long as you meet several requirements and go hand in hand with financial advisors.
How does the selection process work and what is the fund’s investment strategy?
The strategy is simple: invest in American startups in early phases, understood as year 2, 3, or 4, although it is true that The Fund, who is the one with whom we do the joint venture, enters the super-initial phases. This allows us all their big flow, that is, all those companies (which are more than 250), that have already generated and that when they reach more ‘series A’, we can enter with them. Also leverage your profitability a bit. And the process is the same as for The Fund: leveraging the ecosystem of more than 400 founders and ‘business angels’, whose great competitive advantage is that they originate the investments. In other words, they are investors in a personal capacity and in turn these companies contribute to the fund, which is a process that is not the typical top-down venture capital process, but rather a more joint and ecosystem process of 400 and 500 American business angels founders.