Quantius, a commercial lender specializing in innovative companies, has announced the Quantius Innovation Income Fund LP, an open-ended limited partnership formed under Ontario law.
Quantius will serve as investment advisor to the fund, which seeks superior risk-adjusted returns from active investments in outperforming, knowledge-based, and intellectual property-rich small and medium enterprises. The investments will be made in secured loans, which are not correlated with other asset classes. The fund also offers income distributions and portfolio diversification for investors.
“We first went to market in 2016 to lend to knowledge-based, IP-rich Canadian businesses that were growing,” said Quantius Founder and CEO Hasshan Khan, noting that many of the businesses they invested in were global leaders in their niches. “Unsurprisingly, we faced far more demand than we had capacity to handle across sectors from medical technology, aerospace, telecom to clean technology.”
The fund’s lending strategy is based on fundamental analysis to identify underappreciated enterprises. According to the firm, the general financing community may overlook intellectual property and intangible assets in evaluating SMEs. Businesses in the investment portfolio are expected to be diversified well over different industries, sectors, and sizes.
“This fund will allow us to address [innovative SMEs’ demand for funding] far better and at scale, while continuing to provide our investors the non-correlated and superior risk-adjusted returns that we delivered in 2016,” Khan said.
Fund units will be offered on a continuous basis. The minimum initial subscription amount is $100,000, and only accredited investors will be accepted as subscribers.
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