Private Funds & Auction Funds

For

  • Addressing the challenges of liquidity in alternative investment funds
  • Creating opportunities for new product vehicles
  • Broadening access to new sources of capital
Explore

We have built a new industry standard – a sustainable marketplace for today, and started to pave the way forward for future investor access.

Who Partners With Us

Fund Managers / Institutional GPs

Leverage NPM's technology, investor network and regulatory infrastructure to facilitate broader access to liquidity through the secondary market.

HNW Fund Sponsors

In response to fund sponsors taking a more proactive approach to providing liquidity to feeder fund LPs, NPM created a platform to facilitate sponsor-led liquidity programs.

Investment Banks / Secondary Advisors

Create a bespoke liquidity platform for your clients by leveraging NPM's modern secondary technology, comprehensive regulatory framework and ecosystem of institutional buyers.

Limited Partners

Partner with NPM for your private securities transactions to deliver a streamlined transfer process from onboarding through cash settlement.

Why Partner With Us

  • Centralized Model

    Our market model offers a balanced approach of periodic auctions with standardized agreements and process.

  • Regulated Marketplace Intermediary

    We work with our regulatory agencies to help ensure that our platform is compliant and are enabled to operate as a QMS as interpreted in a Private Letter Ruling by the IRS and received exemptive relief from the SEC relating to certain auctions.

  • Investor Network

    Our growing ecosystem of institutional buyers and secondary liquidity providers focuses on secondary transactions across all of the private funds we service.

Fund Vehicles We Support

Direct Funds

The NPM platform brings structure and efficiency to the liquidity process for direct investors, layering in GP approval and price parameters.

Key Offerings

  • Auction model

  • Up to 10% Publicly Traded Partnerships (PTP) safe harbor for GPs

  • Transparency and control of buyers

Auction Funds

NPM elevates the interval fund by plugging monthly, auction based liquidity into the structure, while retaining all other benefits of interval funds such as option to elect RIC status, lower minimums, and zero capital calls. Auctions also help lower cash drag and offer investors choice with dual liquidity solutions.

Key Offerings

  • Registered closed-end fund

  • Elects Regulated Investment Company (RIC) tax status

  • Monthly auctions and annual tenders

Feeder Funds

NPM partners with wealth management distribution platforms to offer liquidity to individual investors through a centralized auction process. The platforms can aggregate and match participant interests through price competition and price discovery while controlling the parameters of the transaction.

Key Offerings

  • Auction model

  • A new standardized solution

  • Up to 10% PTP safe harbor

Registered ’40 Act Fund Managers

Fund managers can provide a new avenue for liquidity through a market-driven mechanism, broadening investment access like never before.

Key Offerings

  • Registered closed-end fund

  • Elects RIC tax status

  • Quarterly fund-sponsored tenders

HOW IT WORKS

The NPM Fund Auction Platform is designed to scale and support multiple fund structures, aligning with the evolution of product creations to open investor access.

01

Designed by Sponsors

Fund managers control the parameters by which their funds are auctioned on our proprietary platform.

02

Regulatory Framework

Built on our deep regulatory experience in building markets, NPM operates as a Qualified Matching Service (QMS), as interpreted by the Private Letter Ruling issued to Nasdaq, Inc. by the IRS for partnership interests and as an alternative trading system (ATS) with granted limited exemptive relief by the SEC, both of which allow for increased limitations in liquidity.

03

Standardized Marketplace

Our platform provides market standardizations that drive efficiency, natural competition and price discovery across multiple fund interests in a centralized marketplace.

04

Benefits Sellers

Integrations with distributors and administrators allow for financial advisors and investors to participate as sellers, rebalance portfolios and actively manage illiquid fund interests.

05

Attract Buyers

By streamlining and centralizing seller interests, NPM allows secondary liquidity providers to actively place bids across multiple fund opportunities; thereby ensuring greater liquidity and market-driven institutional pricing.

06

Streamline Settlement

Our transaction platform manages the full process, including execution of transfer agreements, adjustments to payments and settlement across multiple participants through a unified payment process.

 

 

Evolution of Private Fund Structures:

To learn more about our Auction Funds structure, contact us.

Regulatory Expertise and Leadership

  • Private Letter Ruling

    The NPM platform can operate as a Qualified Matching Service (QMS), as interpreted by the IRS in a Private Letter Ruling.

  • No-Action Relief

    Certain funds using the NPM platform may rely on a limited exemptive relief by the SEC from Rule 102 of Regulation M under the Securities Exchange Act of 1934 in connection with certain auctions.

  • Regulatory Expertise

    NPM operates a regulated ATS through its broker-dealer subsidiary, NPM Securities, LLC. It also operates a broker-dealer, SMTX, LLC, which has been approved to act as a paying agent.

With the increasing demand for alternative investment products from high net worth investors, and fund managers' desire to expand access to new investors, a solution for liquidity becomes a critical enabler for new capital formation.

Adena Friedman, CEO, Nasdaq

 

 

Want to learn more?

For product demos and more information about secondary liquidity, we’re here to help.