ICapital acquires Deutsche Bank's U.S. private equity fund platform
iCapital Network has agreed to acquire the U.S. private equity access fund platform from the asset management division of Deutsche Bank. The latter’s fund portfolio is comprised of 33 funds with approximately $2.5 billion in invested assets on behalf of more than 7,000 U.S. and international investors.
iCapital will take over as investment manager for the U.S. private equity portfolio and iCapital’s financial technology platform will be leveraged to streamline and automate the ongoing administration of the funds, many of which are middle-market oriented. With the transfer of assets, iCapital will service approximately $5 billion in private fund assets, making it one of the largest U.S.-based independent alternative investment platforms for high-net worth investors and their advisers.
“We see this deal as an important step forward in our mission to connect alternative asset managers with high-net-worth individuals,” says Lawrence Calcano, iCapital’s CEO. “For high-quality middle-market funds that want to access the high net-worth channel, we can leverage our technology infrastructure to represent their funds and manage all of the operational infrastructure on their behalf.”
iCapital’s state-of-the-art online portal offers a curated menu of private equity, private credit, venture capital, real estate and hedge funds, along with extensive due diligence support, an automated subscription process and integration with a wide range of custodians and reporting packages. The configurable technology and specialized suite of services is also used by asset managers and financial institutions to streamline and automate their private fund operational infrastructure.
iCapital has previously secured investments from, and formed partnerships with a number of leading wealth management firms, including BlackRock, Fidelity Institutional, Morgan Stanley and UBS. It acquired Credit Suisse’s $1.8 billion hedge fund business in March 2016.
But unlike these mammoth institutions, middle-market funds don’t necessarily have large teams of people that can market their brand to a highly fragmented marketplace, or massive operational teams to manage large numbers of individual investors, explains Calcano. For a fund in this category, he says iCapital acts like a feeder vehicle, aggregating all the fund’s high net-worth investments into a single pool and then managing them on the fund’s behalf.
iCapital’s online platform offers the high-net-worth community—RIAs, broker-dealers, private banks, family offices and sophisticated individual investors—access to a curated menu of private equity, private credit, venture capital, real estate and hedge funds. As part of its offering, iCapital provides extensive due diligence support along with its end-to-end technology solution.