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How to start the VCFM (Venture Capital Fund Management License) Company

How to start the VCFM (Venture Capital Fund Management License) | Singapore Compliance

Venture Capital Fund Management (VCFM)license used by registered or licensed managers manages funds on behalf of large corporations or affluent individuals. In Singapore, to perform any form of fund management, it is mandated that one requires to be a registered and licensed Venture Capital Fund Management Company that is controlled by the Monetary Authority of Singapore (MAS).

The Monetary Authority of Singapore (MAS) has streamlined the rules for venture capital fund managers (VC managers) to make it easier for start-ups to access capital. This involves shortening the VC manager's authorization procedure. The streamlined regulatory regime considers the scope of contractual protections already presents in traditional contracts signed by VC managers' advanced investor client base. A VC manager must satisfy the following criteria to be eligible for the VC manager program:

Forms to be submitted

Form to apply the capital markets services license (CMSL) to operate as a Venture Capital Fund Manager is submitted to MAS. This form has the details of the business, team, nature of the investment, sources of fund, history of the company, etc

Amount of Assets under management

When it comes to Venture Capital Fund Management Company, the number of assets under management does not have a minimum value. This means a VCFM can manage a small or even a considerable amount of assets, unlike RFMC (Registered Fund Management Company), which has a maximum of $250 million.

The number of Directors and Experience

VCFM should have a minimum of two directors. Among these two directors, one of them should work full-time and should also be a Singapore resident.

Minimum Base Capital Requirements

Venture Capital Fund Management Company does not have exact minimum base capital criteria. This means that the company can operate with minimum or even super-high base capital. This is unlike RFMC, which has a minimum capital base of $250,000.

Investor Type

VCFM can handle both Institutional and Accredited only. This means it cannot take Retail. This is unlike RFMC, which is limited to qualified investors.

Investment Type

Venture Capital Fund Management Company should handle Venture Capital. This implies that 80 percent of this fund's portfolio must be in firms that are less than ten years old. RFMC does not have a restriction when it comes to the type of investment.

The number of investors

Venture Capital Fund Management Company handles unlimited numbers of accredited investors or even Qualified investors. This is unlike RFMC, which cannot have more than 30 investors. It can include a maximum of 15 funds. Furthermore, the business would require dedicated and safe office space that your company's directors and employees only access.

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