The Securities and Investment Business (Incubator and Approved Funds) Regulations 2015 published by
Govt of BVI (British Virgin Islands); paved the way for the development of two new products – The Incubator Fund and the Approved Fund. These funds are designed to provide a fast and cost effective method for managers to start open-ended funds which are started by friends and family or as a startup fund. Both Funds are limited by the Net Asset Value and Number of Investors are targeted to small open ended funds The best part it takes just 2 days post documentation to incorporate.
The Incubator Fund
Designed for managers who are looking to start an investment strategy on a trial basis. Net assets of
the fund must not exceed US$20,000,000 or its equivalent in any other currency. No manager,
administrator or custodian is required to be appointed.
The Approved Fund
The approved fund is designed for smaller strategies and friends and family funds and has a higher net asset value threshold and no limit to the length of time if may qualify as an approved fund. It also differs from the incubator fund in requiring an administrator; but it is not required to have a manager or custodian. Net assets of the fund must not exceed US$100,000,000 or its equivalent in any other currency.
Quick Set up
Low setup cost
Low ongoing maintenance cost
Lower Statutory requirements
Common requirements for an Incubator and an Approved Fund
Must have an authorized representative in the BVI
Must have at least two directors at all times, one of which must be an individual.
Total number of investors is limited to 20
The application must include the constitutional documents, investment strategy & investor warning
Annual financial statements to be submitted to the Commission; no requirement for statements to be audited.
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