Circle Partners is an independent fund administrator with offices in the BVI, Cayman Islands, and across the EU, the Americas and Hong Kong.
"We've seen a lot of growth in new BVI fund vehicles over the last 12 months – both the Incubator Fund and the more popular Approved Fund," reflects Peter Jakubicka (pictured), Business Development Manager at Circle Partners. "These vehicles have been the main driver of business for us in the BVI and we've seen continued interest in the first few weeks of January this year; this is partly due to the fact that Cayman has not introduced anything similar in the last few years, which gives the BVI a bit of an advantage."
For those looking to set up a BVI fund, Circle will guide people through the whole process of bringing a new fund to market. A start-up manager can draw upon the experience and network of a single service provider rather than spending time (and money) appointing each service provider to the fund.
Circle helps put in place a legal team to draft all of the constitutional and offering documents for the fund (Offering Memorandum, Investment Management Agreement, Memorandum & Articles of Association, etc) in cooperation with local legal counsels, open bank and brokerage accounts for the fund, and once the fund is set up, Circle performs all of the administration and transfer agency services work.
"It's a real advantage being able to provide this kind of full service to clients these days than in the past, mainly because of the higher costs and barriers to entry. We provide 24/7 support in terms of the incorporation of all structures that are required; the fund itself as well as the management company, which we help to set up for the client in their preferred jurisdiction," explains Jakubicka.
In addition, Circle provides ancillary services. At the local level this includes providing BVI directors (both for BVI funds and BVI corporate vehicles), handling the licensing process by working with the BVI FSC and for onshore purposes "we handle all the necessary FATCA, CRS and Annex IV reporting," says Jakubicka.
Circle is able to support hedge funds as well as private equity strategies. Jakubicka notes that in 2016 a good number of PE funds were structured using the Approved Fund but the biggest group of fund launches was in distressed debt.
When asked what advice Circle gives to those thinking about setting up an offshore fund, Jakubicka says the following:
"We have many years of experience in the industry and we always try to ask the right kind of questions when we first meet a client. For example, where their potential seed investors will come from. If it is Europe, it might make more sense to set up a European vehicle. If it's the US, then the Cayman Islands might be a more obvious choice. But if there is a mixture of investors from across the globe then the BVI might be the right choice of jurisdiction.
"There are multiple factors that we take into account, but understanding where the end investors will be located is one of the most important."
At a time when barriers to entry are rising, being able to rely on a single trusted partner to bring a new fund to market at a reasonable cost is becoming a precious commodity to start-up managers.
