Kingscrowd, a data, legal, and private securities fund issuer, has announced a new offering focused on more mature private firms that are profitable and may have a shorter exit runway.
Online investment firms in the private securities sector have seen a shift from startups and early-stage offerings to also including more mature private firms. Some of which are on a path for a near-term initial public offering. This is good for both investors and platforms, as investors can reduce risk while gaining access to private securities once the realm of the wealthy.
The Kingscrowd Capital Profitability Fund anticipates an exit in 3–6 years.
The Fund will commit up to $5 million with a minimum investment of $10,000.
The fund will charge a 1% fee and a 5% carry.
Kingscrowd is using the AngelList platform to manage the Fund.
Chris Lustrino, Founder and CEO of Kingscrowd, says that investment crowdfunding and modern private market access have enabled more profitable companies to raise growth capital.
“These companies exist. They’re raising capital. Until now, there hasn’t been a systematic way to identify and invest in them at scale.”
The Fund expects to invest in 25 to 30 companies over the next four to five years. Kingscrowd states that portfolio firms must have been profitable over the past two years, with annual revenue exceeding $1 million. These companies must have revenue multiples below 7.5x and a minimum 3.0-star rating from Kingscrowd’s scoring algorithm.
Kingscrowd cited two examples of firms that qualify:
- LMNT, the electrolyte beverage company, raised funds through Regulation CF while already profitable. In its 2023 audited Reg CF annual report, LMNT reported $206.3M in net sales and $41.9M in net income.
- ConsumerDirect, a mortgage technology company, raised at a $151 million valuation in 2024 while profitable. About a year later, the company raised again at a $500 million valuation and has indicated plans to pursue a public listing.
Companies seek to remain private for as long as possible due to regulatory overreach and incomprehensible disclosure demands. This fact has led to fewer public companies available for investors, and when a company completes an IPO, it is frequently more of an exit for early investors.
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