KKR’s Health Care Strategic Growth Fund II is the first of the $491 billion firm’s alternative investment funds to be offered on a public blockchain.
The fund is managed by Securitize’s digital asset management arm, Securitize Capital, and provides exposure to KKR’s $4 billion health care growth equity investment strategy. Officials are hailing the move as a ‘major step’ toward making institutional private market strategies more accessible to individual investors.
“With its ability to digitize operational inefficiencies and increase ease of use for individual investors, blockchain technology has the potential to play an important role in the future of private markets,” said Dan Parant, managing director and co-head of U.S. Private Wealth at KKR. “We’re excited to be working with Securitize to be an early adopter of this technology and look forward to opening our investments up to a new audience of investors.”
KKR’s HCSG II Fund invests in innovative health care companies in North America and Europe with proven products and services that are seeking a partner to commercialize and scale. KKR’s use of blockchain is also a significant step building a “blockchain bridge” from paper-based to digital financial products, officials said.
“Tokenization has the potential to address many of the biggest challenges for individual investors seeking to participate in private market investing by enabling technological and product innovations that were not possible before,” said Securitize CEO Carlos Domingo. “This new fund is an important step toward democratizing access to private equity investments by delivering more efficient access to institutional quality products.”
The Securitize tokenized fund is offered under SEC Reg D 506(c) and Securitize is tokenizing the fund on the Avalanche public blockchain. Avalanche features near-instant transaction finality, and a scaling technology that enables both institutions and individuals to build custom blockchains-as-a-service. Ava Labs is a team supporting the development of Avalanche, and projects building on the network.