With this new sub-fund, the Emergence investment fund provides support to entrepreneurial asset management companies to accelerate the growth of their thematic funds focused on disruptive technologies. In addition, Emergence intends to use this opportunity to promote ambitious asset management strategies in terms of impact and sustainable development. This “Emergence Techs for Good” approach thus works in synergy with the objectives of the Tibi report to better finance the technology companies of tomorrow in France. In concrete terms, the launch involves the selection of two conviction-based funds on the tech theme, managed by Financière Arbevel and Edmond de Rothschild Asset Management, both of which have already benefited from the qualification specific to the “Tibi” initiative.
Paris, 26 July 2022 – The Emergence Sicav announces the launch of Emergence Techs for Good. This 5th sub-fund already has €100 million raised from institutional investors to help finance listed disruptive technology companies in France and Europe.
This new initiative of the Emergence investment fund aims to be part of the guidelines recommended in Philippe Tibi’s report in order to encourage French institutional investors to devote a greater share of their allocations to the development of global tech funds, thus enabling the structural development of cutting-edge expertise in the financing of technology companies in France.
The investments made over a 4-year horizon will support the development of the thematic technology funds of French entrepreneurial management companies with teams of analysts and experienced managers in this segment, and whose sustainable development approach places the search for positive social and environmental impact on the economy at the heart of their investment strategies.
On the occasion of this launch, the Emergence Sicav and its delegated manager NewAlpha Asset Management, selected the Pluvalca Disruptive Opportunities of Financière Arbevel , and EdRS Tech Impact managed by Edmond de Rothschild Asset Management . The investment made is €20 million in each of the funds.
Created in early 2016, Pluvalca Disruptive Opportunities invests primarily in small and mid-caps, mainly European, which have high growth potential as they offer a product or service that will replace a dominant technology on the market. The innovations that they bring must be likely to change the behaviour of economic agents over the long term. The fund is exposed to the various disruptive themes through the selection of companies whose core business is based on innovative technologies (pure players), as well as more traditional companies that benefit from increased growth prospects due to their exposure to these themes (“beneficiaries”) or their integration (“companies undergoing transformation”).
The identification of securities is based on the internal expertise of the analysts and managers of Financière Arbevel, supplemented by a non-financial approach in accordance with the fund’s SRI certification. Stock selection is opportunistic and unconstrained by benchmark. The portfolio is made up of around 60 stocks with a diversified sector profile, including 95% in Europe, with a significant share of French stocks (around 40%). The fund also has a high participation rate in the IPOs of technology stocks and has already made 16 investments in six years during IPOs, 50% of which are in France. Its assets totalled €196 million at 13/07/2022, including the contribution of Emerging Markets.
Sébastien Lalevée, Chief Executive Officer of Financière Arbevel, said: “We are delighted to benefit from the support of the Emergence Techs for Good fund promoted by NewAlpha. Since the company’s takeover twelve years ago, Financière Arbevel has focused on structural growth themes that are less dependent on the economic cycle and a source of continuous innovation. We are at the heart of the financing ecosystem for French and European SMEs through regular investments in the primary and secondary markets. Being part of Techs for Good will further strengthen the integration of our extra-financial approach into our management, with particular attention paid to engagement activities, in order to focus on more impact.”
As a pioneer in thematic management since 1985, Edmond de Rothschild Asset Management has steadily upgraded its range, particularly in Tech, where it managed €1.3 billion as at 30/06/2022. In June 2020, EdRS Tech Impact was launched in the wake of the EdR Fund Big Data fund created in 2015, capitalising on the experience and quality of the results obtained by its managers/analysts. EdRS Tech Impact‘s investment approach focuses on innovative technology companies around the world that promote a positive social and environmental impact on the economy, with the objective of refocusing the fund pragmatically and gradually on the European and French technological ecosystem (which will represent a minimum of 50% of the portfolio in 2025, while its weighting is currently limited to 6% in global technology indices).
The selection of securities is based on the conviction of the managers using a three-dimensional fundamental analysis (on the business model, the valuation and the robustness of technological innovation) also subject to compliance with the SRI label and the integration of Environmental, Social and Governance (ESG) criteria aligned on various sustainable impact themes selected by the managers (the fund is classified as Article 9 in accordance with the SFDR regulations). The portfolio maintains a balance between concentration (around 50 stocks with an average capitalisation of around €110 billion at end-June 2022) and geographical diversification (46% of European stocks and 35% of US stocks at that same date) and sector-based securities. With the contribution of Emergence, EdRS Tech Impact strengthened to €55 million at 13/07/2022.
Christophe Caspar, Global CEO Asset Management, Edmond de Rothschild said: “We welcome the commitment of the Emerging Acceleration Fund to our Edmond de Rothschild Tech Impact Sicav strategy. Together, we want to demonstrate that profitability and societal impact complement each other in a virtuous way. This long-term investment will enable us to further promote the innovative and conviction-based solutions proposed by our investment firm among leading investors in order to support the development of the European technological ecosystem.”
“Within the Tibi qualified fund universe, these two funds have distinguished themselves by the experience of the teams, their ability to analyse disruptive technology stocks and their responsible investment process,” says Antoine Rolland, Chairman of NewAlpha. “We have been sensitive to the ability of these managers to play a key role in the tech ecosystem in Europe and France by providing long-term capital to companies of all market capitalisations and by supporting companies in their IPOs.”
“With Emergence Techs for Good, we are very pleased to support entrepreneurial management of all sizes in order to accelerate their tech funds, whose assets are still low. We therefore want to encourage the financing of innovative tech companies that are committed to having a positive societal impact. Our action also meets a strategic challenge for the Paris financial centre as our new sub-fund supports the development of the skills of tech managers and analysts in Paris and helps strengthen the ecosystem. It is based on the conviction that disruptive technologies are driving sustainable growth over the medium to long term,” said Laurent Deborde, Chairman of Emergence.
Past performance is not a guide to future performance or the achievement of the objectives of the various products. Performance is not constant over time. Investors should be aware that investing involves the risk of the total or partial loss of the capital invested.
Main associated risks: Equity risk and capital loss. Risk scale: Pluvalca Disruptive Opportunities 6 / 7. EdRS Tech Impact 6/7
DISCLAIMER – This press release is intended for French professional investors only, within the meaning of the Markets in Financial Instruments Directive. It is published jointly by New Alpha Asset Management, whose registered office is located at 128, boulevard Raspail, 75006 Paris, France, and the Emergence Sicav, whose registered office is located at 28 place de la Bourse, 75002 Paris, France. The information contained herein shall not under any circumstances be interpreted as an offer or invitation to invest, investment advisory or a recommendation for specific investments. New Alpha Asset Management is a portfolio management company authorised by the AMF under number GP05000001 as of 20 January 2005. References to prior rankings and awards are no guarantee of future rankings or awards. Depending on the date this document was drafted, the information herein may no longer be current.