Discover how venture capital works inside an evergreen fund. See how PFL’s long-term investment model compounds returns across overlapping J-curves and portfolio exits.
Venture capital invests in early‑ and growth‑stage companies that have significant upside potential but higher risk. Returns often follow the “J Curve”: early years may be flat or negative (capital is deployed; companies invest for growth; fees are incurred). Later, as companies mature and succeed, exits and liquidity events can produce strong positive returns.
Because PFL is evergreen, the J Curve effectively repeats for every (successful) investment. At any time, our portfolio contains companies at different ages and stages, some just beginning their journey, through to growing and mature businesses, and those harvesting returns, which blends return profiles across the portfolio and across time.
At any given time, there are usually several of PFL’s portfolio companies engaging with potential acquirers. Most of these engagements are exploratory in nature but every now and then an engagement can turn into a viable approach to begin an acquisition process. We can’t predict when and which approaches might develop into a formal process. Sometimes they are obvious from the outset and at other times they can eventuate from nowhere.
Shareholders will notice that the fund’s asset value might ebb and flow from month-to-month, as reported in our monthly Net Asset Value reports, as we work through our company valuation schedule.
We encourage investors to take a long-term view of the fund, and have confidence that, over time, a subset of companies in the portfolio should experience outsized growth. When this happens, they attract the attention of potential acquirers and may potentially exit (often at a premium). It is these companies that will drive the growth in the fund.
While the fund grows over time, it is important to note that individual shareholder’s returns are primarily determined by the price you pay when you buy shares and the price you receive when you sell them.
Example – Company Exit Lifecycle:
How PFL differs from a traditional closed‑end GP/LP venture capital fund:
| Traditional GP/LP VC Fund | Punakaiki Fund (PFL) |
| Fixed life (often ~10 years) then wind‑up | Evergreen; no fixed wind‑up |
| An investor’s capital is called by the fund over time; some capital retained for fees | No capital calls; you buy shares directly with a single payment |
| Limited or no interim liquidity | Periodic share trading* via Catalist Markets |
| Typically no underlying investments to start with; portfolio revealed over time | Invest in a seeded fund with a visible, evolving portfolio of investments, with exits from time to time** |
| Fees paid from committed capital paid time-to-time by the investor | Fees paid by PFL on behalf of shareholders and calculated from the overall asset value |
Result: 100% of your investment is exposed to PFL’s portfolio from day one, and capital from exits can be recycled into new opportunities or distributed according to the Board’s Capital Allocation Policy.
*Liquidity in periodic secondary auctions is determined by the market participants, including price, and is not guaranteed.
** Proceeds from exits governed by PFL’s Capital Allocation Policy
We aim to keep shareholders well informed through a regular cadence of reports and updates. All of the following updates are emailed to shareholders, published on the Key Documents page on our website, and uploaded to Catalist:
