Experts affirmed that the increased accessibility of private funds to high-net worth retail investors traditionally reserved for institutional players marks a significant trend in the democratisation of private funds. This opens doors to a broader base of investors, including those with substantial but perhaps not astronomical wealth.
Attended by more than 100 industry professionals, Democratisation of Private Markets was the topic of discussion at our Funds Focus event held in London on 18 March and was kindly sponsored by Grant Thornton, Channel Islands.
Opening with a welcome speech by our London Director for Funds and Corporate, Nicola Le Brocq, the event included a panel discussion moderated by Stuart Pinnington, Head of Alternative Assets at IQ-EQ, and an insightful keynote speech by Nick Smith, Managing Director at AIMA. Panellists were: Marie Fitzpatrick, ICS Head of Client Experience – Fund Services at JTC, Robert Mellor, Partner & UK Alternatives Markets Leader at PwC, Russell Kelly, Head of Advisory KPMG Islands Group at KPMG in the Crown Dependencies and Dilmun Leach, Group Partner at Walkers.
The democratisation phenomenon not only reshapes the capital-raising landscape but also raises critical questions around investor protection and regulatory oversight. The importance of transparency, accountability and fair treatment of these investors by regulators was stressed while the panel also commented that regulators must also consider competitiveness, economic growth and at the same time create regimes to cater for these trends.
Another evolving factor considered by the panel was tokenisation and digital infrastructure. Using blockchain enables the conversion of funds into tradable digital securities. Essentially, technology has the potential to drive the opening up of alternatives markets to an even wider market.
Nicola Le Brocq commented: “Jersey’s significant flexibility as an international finance enables it to cater to investor needs. It is vital that Jersey continues to improve services and regulations in order to future-proof our product offering and provide better choices for investors.”
One challenge highlighted by Nicola was that traditional financial service intermediaries may face difficulties in adapting to new technologies, stressing the need to invest in technology and talent to remain competitive.
She emphasised that jurisdictions, like Jersey, with a proactive regulatory environment and a strong reputation for innovation in both finance and technology are well positioned to attract business, and that the increased accessibility of private funds presents a huge opportunity for Jersey to continue building out its service offering to private assets.
Jersey, as a specialist centre for the alternative asset classes, including hedge, real estate and private equity funds, has been at the forefront of the global funds industry for more than 60 years. In that time, it has earned a world-class reputation for the domiciliation, structuring, management and administration of alternative investment funds and special purpose vehicles, with total funds business in Jersey valued at US$660 billion.
You can view all of the images from the event on our Flickr account.
