Member Profile | Invico Capital Corporation
New issuers are appearing everywhere with the continuing development of the Exempt Market, combined with lower costs and barriers to entry, relative to traditional public or full prospectus offerings. With so many choices it can be hard for investors to sort through the clutter to find the right investments vs. highly speculative offerings.
In the eyes of investors, Exempt Market securities are often still perceived as carrying a higher risk given the relative novelty of the industry, the young companies, often inexperienced management teams, as well as uncertainty over acceptable practises and lighter regulation. To establish confidence in the exempt business it is important to work with experienced investment practitioners with the right credentials, construct quality products, utilize EMDs who are able to identify the right match for investors to investment products, and high levels of internal regulation.
Using their proven track record of superior returns and the utmost transparency in their dealings, Invico Capital Corporation is providing investors with excellent products with their no-nonsense approach to investing and focus on capital preservation.
Invico Capital Corporation is a Calgary-based privately focused alternative investment firm offering unique investment opportunities targeting yield, real estate, and energy. Invico focuses on unique situations that are poorly served by traditional capital providers. These investments are typically unavailable to the average retail and high net worth investor.
Founded in 2005, Invico works with select advisors to offer investment products distributed through the IIROC and Exempt Market networks. Invico exited the third party distribution of exempt market product through their affiliate Pennant Capital Partner’s Inc. in 2012 to focus on asset management, the traditional strength of the firm. However, the experience with Pennant Capital Partners has opened up several new distribution relationships with EMD’s as Invico’s products have demonstrated consistent and stable returns that resulted in an avid advisor following. Invico is unique in the exempt world, as the firm has been registered since 2005 and traditionally operated strictly with accredited investors including a significant component of large family office participation. As the exempt market distribution models evolved through regulation, Invico now provides its investments through an offering memorandum which can generally be more broadly distributed in all provinces outside Ontario.
For the Invico Pure Yield Fund, Invico’s investing mandate is simple in concept: provide a product that offers a well above average return for the investor on a risk adjusted basis with a constant focus on wealth preservation. The execution of the mandate is really where Invico excels by focusing on niche situations outside of traditional public debt and equity markets through a diversified portfolio approach. Specifically, Invico specializes in private situations with the placement of privately negotiated bridge, mezzanine, and short term trade finance. The firm is focused on lending in areas that the traditional capital markets do not serve well; more often than not these are private high growth companies that need short term financing. The firm has significant depth in house that allows us to address short term capital needs in the $1-10 million lending range, an area that the highly consolidated banking sector doesn’t always serve with the same level of urgency as larger accounts. In banking, credits of this are generally administered through the branch system with credit adjudication occurring offsite at a centralized underwriting department. This structure does not result in banks being well positioned to respond quickly or positively to credits requests that fall outside the banks’ standardized underwriting processes. We chose to participate within these niches as we are able to get a much higher rate of return because we focus in areas where the supply of capital is limited, not because we lend to situations with poor credit quality.
In addition to the lending portfolio, the firm maintains a significant private equity portfolio in both energy and real estate. Through this approach, Invico allows investors to access unique, private investment opportunities that are not readily available to retail or high net worth investors in a diversified manner.
Currently, Invico has two options available for investment—The Invico Pure Yield Fund and The Invico Balanced Real Estate Fund and will look to launch a new private energy offering in the near future.
The Invico Pure Yield Fund offers the investor monthly distributions with a monthly distribution of 8% per annum since February of 2011 and has also paid out additional profit share distributions related the performance achieved in 2011 and again in 2012. The Invico Pure Yield Fund is tax-efficient, RRSP eligible, and offers quarterly liquidity through a redemption feature, making this unique within private markets. With redemption capability and a highly diversified private lending portfolio, the fund is suitable for investors looking for an alternative to mutual and bond funds that often have not meet investor expectations and leave them highly exposed to raising interest rates and volatility. Invico also introduced a 3 year term, 10% distribution unit in 2012.
The Invico Balanced Real Estate Fund takes an alternative approach to investing in the real estate sector by balancing near term yield based strategies with longer term growth investments. The yield portfolio pays investors to wait for the longer term maturity of the funds hard asset investment, which will be predominately focused on multi-family assets. The fund has the ability to complete transactions in both Canada and the US, and has completed the purchase of a performing US mortgage pool that was acquired at discount to face value and has been performing above initial expectations. The fund is now focused on building out the hard asset multi-family portfolio.
In its seven years of operations, Invico has demonstrated a proven investment approach and compiled a capable team to provide its clients with effective solutions to access private markets. This focus and return history has led to steady growth as the firm now manages in excess of $160 million of assets as investor interest continues to grow in the firm’s unique value proposition.