Episode 26: Marcus New – Investing in Tax Efficient Private Equity with InvestX

Marcus New is the CEO of InvestX which allows accredited investors to participate in the late-stage of private businesses like Spotify, Dropbox, and Uber. One of the significant challenges is how does one get in on an IPO and more importantly can you invest early in a technology company. They typically invest in these companies three years before there initial IPO. They look for companies with growth, high revenue, and a global footprint. They can be in medical information, big data security, cloud computing and many others in the technology sector.

They have launched two funds one in Canada and the other in the United States. The fund is set for four years, and they typically make investments in 10 to 15 different companies in the first year. They then redistribute the profits back to investors over the years two through four. This structure gives investors a speedy return from these private growth equity investments. InvestX structures their Funds with Tax Efficiency in mind for the benefit of Canadians, Americans, and those from other parts of the world.

They typically look to raise 100 million dollars. The fund closes in Canada at the end of February, and the U.S. closes by the end of March.

InvestX tries to model various companies to see if they can get a 2x – 3x on capital investment. This determines the price they will pay for it since they share in a percentage of the performance. He describes how those management fees work. U.S. investors can deal directly with InvestX while Canadians need to go through individual brokerages.

Talking Points From This Weeks Episode
• InvestX helps Accredited Investors get to invest in companies well before IPO’s
• The funds are typically for four years and are composed of several companies.
• They are paid by performance. The funds are all based in US Dollars.

About Our Guest
Marcus New is a passionate and experienced entrepreneur with a strong track record of success. He is the founder and chairman (and previously the CEO) of Stockhouse, Canada’s leading financial community and a global hub for affluent investors, with up to 1 million unique monthly visitors. Before launching Stockhouse, Marcus built Stockgroup Media, an online information company whose client base consisted of 13 of the top 25 Canadian brokerage firms, 14 of the top 15 global institutional sales desks, and over 200 hedge funds.

Marcus is an active participant in the entrepreneurial community, having served as the past President of the Vancouver Chapter and Canadian Conference Chair for the Entrepreneurs Organization (EO) and a finalist for Ernst & Young’s “Entrepreneur of the Year.” Marcus is an alumnus of MIT’s prestigious “Birthing of Giants” program (completed the course in 2004). He also co-founded the Equity Crowdfunding Association of Canada (ECFA), with a mandate to support, educate and develop the Equity Crowdfunding industry in Canada. Marcus holds a B.A. in Business from Trinity Western University.

During his spare time, Marcus, along with his wife Yvonne and two children, enjoy an active lifestyle, which includes coaching and attending his son’s hockey games and playing in his hockey league.

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