Ion Pacific eyes $100m for VC secondaries – exclusive

The Hong Kong secondaries firm, which raised $35m for its debut vehicle, mainly buys LP stakes in Asian and Israeli VC funds.

Ion Pacific, a venture capital secondaries firm, will more than treble the target of its next fund.

The Hong Kong-headquartered firm will target around $100 million for Ion Pacific Stonecutter Fund II, which will come to market in the fourth quarter of 2019 or the first quarter of 2020, according to a source familiar with the matter.

The firm’s first fund Ion Pacific Stonecutter Fund I raised $35 million against a target of $30 million by final close in November 2018, according to PEI data. It was in market for around nine months. It is not clear which LPs are invested in the fund.

Founded in 2015 by Michael Joseph and Itamar Har-Even, formerly of Jack Ma-backed financial services group Reorient Group, Ion Pacific acquires limited partnership stakes in Asian VC funds, backs GP-led processes and does direct secondaries deals. It also targets Israeli funds from its Tel Aviv office, which opened last year.

Ion Pacific would not comment on fundraising. Joseph said that South-East Asia (excluding China) was a particularly attractive area for the firm given the region’s strong GDP growth, young population and the long hold periods required for assets based in the region.

“The venture funds there are structured in the same ways as US funds or Chinese funds… But a five- to six-year scaling timeline is not that common in South-East Asia,” he said.

Most of the assets Ion Pacific buys are at a discount from LPs that have to sell to free up liquidity, not from those carrying out portfolio management, he added.

Asia accounted for 10 percent of funds changing hands in the first half of 2019, the same proportion as full-year 2018, according to advisor Greenhill.