05.10.2022 15:45:00

Hamilton Lane and Securitize to Tokenize Funds, Expanding Access to Private Markets for a Broader Set of Investors

Partnership Represents First Time Hamilton Lane Products Will Be Available in Tokenized Form in the U.S.

 NEW YORK and CONSHOHOCKEN, Pa., Oct. 5, 2022 /PRNewswire/ -- Securitize, a leading digital asset securities firm, and Hamilton Lane (NASDAQ: HLNE), a leading global private markets investment firm, today announced a partnership to expand investor access to Hamilton Lane's funds through tokenization.

Through this partnership, qualified U.S.-based investors will be able to more easily access three distinct Hamilton Lane funds, which will be available through new tokenized feeder funds. The component funds provide exposure to direct equities, private credit and secondary transactions, and will be tokenized by Securitize's digital transfer agency, managed by Securitize's digital asset management arm, Securitize Capital, and be available for investment on its broker-dealer, Securitize Markets in Q4 2022.

Securitize and Hamilton Lane (NASDAQ: HLNE) announce a partnership.

"Hamilton Lane offers some of the best-performing private markets products available, but historically they have been limited to institutional investors. Tokenization now makes it possible for individual investors to participate in private equity value creation for the first time in a digitally native way," said Carlos Domingo, CEO of Securitize. "We are at the beginning of a process through which individual investors can access the same kinds of opportunities as university endowments or sovereign wealth funds, and that is very exciting."

Victor Jung, Head of Digital Assets at Hamilton Lane, commented: "Since our firm's inception, we've been committed to servicing our clients and to providing enhanced financial wellbeing for those who depend on us. This collaboration with Securitize is our latest step toward enabling access to the strong returns and performance opportunities generated within the private markets space for a newer set of investors, while increasing usability and transparency through the use of blockchain technology."

These new tokenized funds highlight Hamilton Lane's commitment to expanding ease of access to the private markets through the utilization of blockchain, and illustrate the convergence of four important trends:

  • Private market alternative investments historically outperform public markets.
    The number of private companies with revenues over $100 million dwarfs the number of public companies with revenues in that range, with roughly 95,000 private companies globally falling into this bucket, compared to 10,000 public companies. The larger private markets opportunity set, a U.S. IPO market that has significantly slowed[1], and consistent outperformance of the private markets have together piqued the interest of a growing number of individual investors. Hamilton Lane data shows the majority of private equity funds have outperformed their public market equivalents in 19 of the last 20 years.[2]
  • Individual investors are seeking access to better investment opportunities.
    With inflation over 8%,[3] the S&P 500 in the red year-over-year,[4] and over $500 billion in wealth being transferred between generations annually,[5] investors need meaningful returns in order to generate wealth. Investors are more interested in and open to alternative and digitally-native investments than ever.
  • Investment firms' growth will increasingly be driven by individual investors.
    Private equity investments have historically been most accessible to institutional or ultra-high net worth investors and least accessible to individual investors. Blockchain technology makes expanding access to individual investors possible. Over 10% of American households are accredited investors, holding about $75 trillion in wealth.[6] As private market investing becomes more accessible to individual investors, Morgan Stanley estimates total assets under management can grow by $3 trillion over the next three years.[7]

  • Technological and structural changes have enabled individual investors access to products previously available to institutional investors.
    Historically, individual investors faced multiple hurdles in gaining access to the private markets. Today, there are structures available that provide lower investment minimums, remove the burdensome traditional capital call process, allow for the option for liquidity and offer easier tax reporting. At the same time, the advancement of blockchain technology has made private market opportunities more easily accessible through digitizing paper processes, providing more creative structures, and enabling fractional ownership via tokenization, all in accordance with U.S. laws.
  • About Securitize

    Securitize is the world's leading platform for tokenizing and accessing securitized financial products, enabling businesses to raise capital and investors to access digital asset security opportunities never before possible. Securitize's end-to-end solution enables private companies to onboard and manage shareholders, raise capital, and enable potential liquidity, as well as allows investors to access equity in private companies and tokenized funds, consistent with securities laws. With over 1.2 million investors and 3,000 businesses already connected, Securitize is comprised of Securitize, Inc, and its subsidiaries Securitize, LLC and Pacific Stock Transfer (both SEC-registered transfer agents), Securitize Capital, LLC, Securitize Markets, LLC (an SEC-registered broker-dealer, member of FINRA and SIPC, and operator of the company's alternative trading system). Learn more at https://www.securitize.io.

    About Hamilton Lane

    Hamilton Lane (NASDAQ: HLNE) is one of the largest private markets investment firms globally, providing innovative solutions to institutional and private wealth investors around the world. Dedicated exclusively to private markets investing for 30 years, the firm currently employs more than 530 professionals operating in offices throughout North America, Europe, Asia Pacific and the Middle East. Hamilton Lane has more than $832 billion in assets under management and supervision, composed of $108 billion in discretionary assets and more than $724 billion in advisory assets, as of June 30, 2022. Hamilton Lane specializes in building flexible investment programs that provide clients access to the full spectrum of private markets strategies, sectors and geographies. For more information, please visit www.hamiltonlane.com or follow Hamilton Lane on LinkedIn: https://www.linkedin.com/company/hamilton-lane/.

    Disclosures

    Private market investments are speculative and considered risky, including potential loss of your investment, and may not be appropriate for every shareholder. Private investments are generally an illiquid asset class; shareholders cannot sell their funds when they want to without potentially facing high losses. Any discussion of liquidity is purely speculative. Past performance is not indicative of future results.

    [1] "IPOs in the US – statistics and facts", Statista, August 2022 
    [2] Hamilton Lane Data, Bloomberg; July 2022 
    [3] Current US Inflation Rates, https://www.usinflationcalculator.com/inflation/current-inflation-rates/  
    [4] MarketWatch S&P 500 Index, https://www.marketwatch.com/investing/index/spx
    [5] "The Greatest Wealth Transfer In History: What's Happening and What Are The Implications," Forbes, November 2019, https://www.forbes.com/sites/markhall/2019/11/11/the-greatest-wealth-transfer-in-history-whats-happening-and-what-are-the-implications/?sh=31fa24344090
    [6] "How many accredited investors are there in America?", DQYDJ, https://dqydj.com/accredited-investors-in-america/
    [7] "How long will the golden age of private markets last?", Morgan Stanley research report, October 2021

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    SOURCE Securitize

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