Palico hosts two marketplaces specific to Private Equity:

Palico’s Primary Marketplace:

Our Primary Marketplace allows LPs to browse or be alerted of GP funds matching their investment strategy. The platform hosts a global array of GP funds across all PE fund strategies. Inversely, GPs can curate a digital profile for their fund where they can receive requests from interested LPs looking to gain further access and information.

Secondary Marketplace:

Palico’s Secondary Marketplace maximizes price and proceeds to sellers by opening LP stakes to a global online community of both traditional and non-traditional buyers. Our secondary marketplace is a platform designed to give sellers of PE fund stakes greater access to liquidity. Investors looking to efficiently sell their PE fund stake(s) can anonymously host details with a secure virtual data room to engage with interested buyers, mutually benefiting from a digitally streamlined secondary sales process.

Members of Palico’s platform are limited exclusively to professional LP investors and GP Private Equity specialists with the aim of curating a space featuring sophisticated and experienced PE players.

Limited Partners (LP) :

Palico’s marketplace requires that all LP members on the platform meet the criteria of Accredited Investor as defined by the SEC. Palico is a platform designed exclusively for professional investors and does not host any retail investors. In total, Palico has 3,100+ individual LP members across 1,400+ LP firms. The following list showcases all Palico LP member types:

• Pension Funds
• Governments and Sovereign Wealth Funds
• Foundations and Endowments
• Fund of Funds
• Family Offices
• Registered Investment Advisers
• Gatekeepers
• Banks and Insurance Companies
• Corporate Investors
• Asset Managers
• Ultra High Net Worth Individuals (on a case by case basis)

In order to become a member of Palico’s marketplace, you can fill out our sign up form in under five minutes. Once submitted, Palico’s internal compliance team handles the rest:

For LPs

To verify LPs joining the platform, Palico validates applicants across four areas:

1. User verification: proof of identity and employment.
2. Investor status verification: verify the status of the applicant firm or individual as an Accredited Investor.
3. Proof of regulatory oversight body: confirmation of the regulatory body that the company falls under (i.e., FINRA in the USA or FCA in the UK).

For GPs

For extra validation, our internal compliance team reviews GP applications in the following areas for validation:

Quality Check  

1. Must prove that they are a GP fund active in PE. (Please note that we do not host hedge funds).
2. At minimum, the GP fund must have successfully raised over $100M (subject to discretion) in a previous fund.
3. The GP manages closed-end funds / blind pool vehicles.

Compliance Check

1. Firm-level verification: validate the existence of the corporate entity.
2. User verification: prove identity as well as employment for the new user.
3. Proof of regulatory oversight body: confirm that the regulatory body of the fund falls under (i.e., FINRA in the USA or FCA in the UK).

• Single LP stakes
• Portfolio of LP fund stakes
• Co-investment opportunities (case by case basis)
• Fund stakes ranging from $1-100M (exceptions can apply)

• Palico’s platform can host all types of secondary fund sales, and therefore, any PE fund investor looking to sell their Private Equity fund stake will be able to leverage the platform. However, Palico’s marketplace specializes in smaller fund stakes (of roughly $20M in NAV or below). 

  As a result of their transaction size, smaller stakes have traditionally experienced limited access to a competitive bidding process or general liquidity. 

  At Palico, we expand this access to liquidity by providing a digital solution where PE investors with smaller fund stakes can attract bids via a competitive multi-bidder process and use digital tools to streamline and guide the deal forward.
   
  Benefits of using Palico’s Secondary Marketplace:
   
  1. Competitive Bidding Process: small secondary sellers benefit from a global marketplace featuring secondary buyers ranging from large secondary funds to smaller secondary specialists.
  2. Secure Virtual Data Room: our platform is designed with a fully encrypted data room and messaging module, allowing you to display sensitive information and engage in secure conversations.
  3. Seller Anonymity: the seller always remains anonymous when listing the fund stake for sale. The seller is only obligated to reveal themselves to the buyer when accepting bids from interested buyers.
  4. No Obligation to Sell: there is no obligation to sell — the seller can close their listing at any time without any fees or penalty.
  5. Streamlined Process: our platform provides digital tools that streamline the various stages of the sales process including data room set up, non-binding bids and binding bids.
  6. Comprehensive Customer Service: every secondary sales transaction is assigned to a dedicated Palico PE account services individual to assist throughout the process. Email, call, or message us – we aim to provide a premium customer experience.

Mandatory documents:

• Quarterly Report
• Financial Statements
• Capital Account Statement

Subsequent documents:

• Subscription Agreement
• Limited Partnership Agreement (LPA)
• Private Placement Memorandum (PPM)

• Term Sheet
• Sales and Purchase Agreement
• Transfer Agreement

While legal paperwork will be finalized offline, supplemental documents may be hosted in Palico’s virtual data room as needed.

Palico’s fundraising marketplace is a two-sided marketplace designed to complement fundraising efforts of GP’s and to help optimize LP’s private equity investment opportunities.

For GPs

What documents should I host in my virtual data room?

At a minimum, we require that a fund teaser be uploaded to the GP’s virtual data room. However, in order to optimize the process, we highly recommend that the following documents also be hosted in the virtual data room:

1. Fund Presentation
2. Limited Partnership Agreement (LPA)
3. Private Placement Memorandum (PPM) or Due Diligence Questionnaire (DDQ)

For LPs 

To browse and request access to GP data rooms on Palico, you need to be a registered LP member of the platform. As a member, you can browse all GP fundraising opportunities on the platform.

What is the process of investing in a GP fund on Palico?

Once you’ve identified a GP fund that you are interested in learning more about, you need to request access to that GPs virtual data room. At this point, it is up to the GP to approve access to their virtual data room. If access is granted, the LP will be required to sign an NDA before having access to the files hosted in the data room. There is also an encrypted messaging module hosted in the virtual data room where both parties can ask clarifying questions or request additional information.

Palico’s platform combines technological excellence along with regulatory compliance. We continuously improve the platform to ensure the security and confidentiality for all of our users.

Security and Data Protection:

Palico is a cloud-based platform and complies with the industry-standard data security protocols. Our network and infrastructure use several security layers (encryption, authentication, authorization) to guarantee the confidentiality and integrity of all recorded and exchanged data. All security layers are based on widely used and approved protocols in the industry and comply with ISO 27001 certification.

Confidentiality:

Palico offers a virtual data room to share confidential information with selected counterparties. The data room’s access is granted by the seller (in the case of a secondary sale) or by the GP (in the case of fundraising) for chosen requesters.
Palico also provides an end-to-end encrypted messaging module in order to negotiate and discuss transaction details privately.

Anonymity:

Palico is designed to maintain the anonymity of all LP members on the platform:

1. Palico respects the LP’s preference to remain anonymous on the platform. 
2. At the sellers discretion, their identity can be kept confidential up until the LOI stage.
3. The LP has no obligation to reveal their identity until the process gets to the LOI stage of the secondary transaction.

Fairness:

The marketplace is controlled and overseen by our internal compliance team. The compliance team thoroughly monitors member activity to ensure that no member is misusing the information available online.

Transparency and Standardization:

Palico is built on the premise of providing a level-playing field to all its members on the platform. It does so by giving all its members’ access to the same information presented in a standardized form for all investment or sale opportunities available on the marketplace.