Moonfare holds a semi-annual digital secondary market. This structured auction enables investors looking for early liquidity to sell their Moonfare allocations to other members or our institutional partner, Lexington Capital.
Moonfare has partnered with the world's largest and longest-running operator of private equity secondaries, Lexington Partners. Together, we bring institutional liquidity to the Moonfare platform.
Throughout the process, a Moonfare team member will be on standby to help you out. Our team closely monitors and manages the auction process to ensure an efficient and optimal outcome for all clients on our platform.
As part of our mission to digitise the private market landscape, Moonfare handles the auction process entirely on our platform. It's our way of revolutionising the way things are done; no cumbersome processes or paper-based methodologies here.
Twice a year — in the spring and fall — we hold an auction for clients who want to sell their stakes in Moonfare’s private equity funds or acquire new stakes. Buyers in this auction process can also upsize their existing stakes.
Liquidity on the secondary market is not guaranteed.
Moonfare clients may signal their interest to sell at any time. We'll make sure to take note of this and contact interested parties before the Moonfare secondary market auction starts to communicate next steps.
Our clients confirm that they want to sell by providing the proportion and minimum reserve price for the stake they're selling. In turn, we'll record and safeguard this confidential information.
During the auction process, buyers can conduct due diligence and submit binding offers. While this is happening, no further action is needed from sellers.
Moonfare matches buyers with sellers. We streamline this process so that we can give sellers the best price available.
Moonfare digitally notifies relevant parties about the auction's outcome. We distribute the legal documents that govern the transactions and oversee the closing and transfer process.
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NAVs reflect the value of an investor’s stake in a private equity fund. Fund managers report NAV to their investors quarterly and according to strict valuation guidelines. The fund managers Moonfare works with are large organisations with significant investors, like life insurance companies and pension funds; they have high standards around accuracy and controlling the valuation process. Moonfare and our investors benefit from these high standards. The NAV reported to our investors additionally includes any potential cash reserves and liabilities of the feeder vehicles.
Buyers and sellers on the secondary market use NAV as a reference for pricing the stake involved in their transactions. The buyer assumes the obligation to meet the remaining capital commitments in full.
Moonfare’s secondary market fees are:
• Payable only by the seller
• Payable only if a transaction is fully consummated (i.e. success-fee based)
• Based on the Total Exposure* of the fund commitment being sold, defined as the sum of:
• The net purchase price received; AND
• The unfunded commitment released
*minimum fees apply (see below)
Moonfare will charge the seller the higher of:
• Three percent of Total Exposure; OR
• €3,000 flat fee (minimum fee)
EXAMPLE I
Commitment: €100,000
Contributed: €25,000
NAV: €20,000
Unfunded: €75,000
Cash price: €16,000 (80 percent of NAV)
Total exposure = €91,000
Three percent on total exposure = €2,730
Minimum fee = €3,000
Fee charged: €3,000 for transfer
EXAMPLE II
Commitment: €500,000
Contributed: €125,000
NAV: €150,000
Unfunded: €375,000
Cash price: €139,500 (93 percent of NAV)
Total exposure = €514,500
Three percent on total exposure = €15,435
Minimum fee = €3,000
Fee charged: €15,435 for transfer
It's necessary to disclose the identity of either transacting party to the respective counterparty when a transaction is executed — but not during the auction process.
A transaction becomes legally-binding and irreversible once legal agreements have been executed by both buyer and seller. Prior to signing the agreement, either the buyer or seller can withdraw from the process.
A potential buyer or seller can indicate interest to participate in the Moonfare secondary market at any time via the Moonfare platform. Moonfare will conduct a structured auction process on a semi-annual basis, usually in the spring and fall each year, to facilitate transactions between buyers and sellers.
Moonfare matches bids that emerge through the auction to provide sellers the best price available. Higher bids from buyers are filled first. In case of any remaining supply (i.e. stakes offered by sellers for auction), Moonfare will fill orders starting with the next highest price until all supply is sold — while respecting the seller’s reserve price.
Stakes offered for sale in the auction are preferably sold in their entirety, but can also be only partially sold. The stake or partial stake can be sold to a single buyer or divided and sold to multiple buyers, so long as the asking price is met. Moonfare reserves the right, at its sole discretion and with a view to achieve the most favourable outcome for its existing investors and funds, to assign buyers and sellers provided the general auction rules are maintained. Moonfare reserves the right to cancel or abort any auction if the consummation of the transaction would not be beneficial to its investors, platform and/or partners.
Once a buyer and seller are matched, documents must be completed and funds transferred within the periods provided in the match notification. Moonfare will facilitate the execution of completed transfers once documents are approved and funding is confirmed from all participants.
Bids are binding upon the close of the auction. If you wish to change or cancel your bid, you may contact us before then.