Correspondence 0001104659-25-002702 from Pop Venture Fund (CIK 0002012830)
Pop Venture Fund (CIK 0002012830)
Date: Jan. 10, 2025 · CIK: 0002012830 · Accession: 0001104659-25-002702
AI Filing Summary & Sentiment
File numbers found in text: 333-278367, 811-23950
Letter
VIA EDGAR Securities and Exchange Commission Division of Investment Management 100 F Street, NE Washington, D.C. 20002 Re: The Pop Venture Fund (File Nos. 811-23950 and 333-278367)
Dear Mr. Brodsky and Ms. Hamilton:
On behalf of The Pop Venture Fund (the “Fund”) set forth below are the Fund’s responses to the comments provided by the staff (the “Staff”) of the Division of Investment Management of the U.S. Securities and Exchange Commission (the “SEC”) telephonically on November 7, 2024, November 19, 2024, November 22, 2024, December 23, 2024, and January 3, 2025 relating to the Fund’s Pre-Effective Amendment No. 3 to the Registration Statement on Form N-2 (File Nos. 811-23950 and 333-278367) (the “Registration Statement”) filed on October 28, 2024. The Staff’s comments are set forth below and are followed by the Fund’s responses. Capitalized terms used but not defined herein have the same meaning as set forth in the Registration Statement.
Comments Provided on November 7, 2024:
1. Comment: Please supplementally explain whether a company would seek a diligence report from CrowdCheck if it was not seeking an investment from The Pop Venture Fund.
Response: CrowdCheck is a company which conducts and prepares diligence reports for variety of clients, not only the Adviser. Other companies and/or potential investors may contract with CrowdCheck to prepare a diligence report on a potential target investment company. Pop Venture is not the only entity using CrowdCheck’s services.
2. Comment: In connection with the response to comment #17 in the Fund’s October 11, 2024 comment response letter, please confirm supplementally that there are no conflicts among CrowdCheck’s operation of the Locker and the Fund and its investors, aside from the conflict-of-interest disclosure that the Fund added in connection with its response to comment #1 in
- 2 - January 10, 2025
the Fund’s August 7, 2024 comment response letter (providing the use of an affiliated service provider). If the Fund’s position is that there are no conflicts at all, please advise.
Response: The Fund confirms that there are no conflicts among CrowdCheck’s operation of the Locker and the Fund and its investors other than the potential for conflicts of interest with respect to the use of an affiliated service provider (as outlined in the conflict-of-interest disclosure added to the Registration Statement in response to comment #1 of the August 7, 2024 comment response letter).
3. Comment: Please disclose in the principal strategies section of the Fund’s prospectus how the Fund is defining “venture company,” as that term is used in the Fund’s definition of private company.
Response: The Fund has added disclosure in the principal strategies section of the Fund’s prospectus stating “Venture companies are early- through growth-stage companies with high growth potential, in multiple sectors.”
Comments Provided on November 19, 2024:
4. Comment: With respect to the fee table on page 10 of the Prospectus:
a. Please add a footnote detailing the term of the management fee.
b. Please align the presentation of the Annual Fund Expenses with format provided in Form N-2, specifically with reference to the presentation of the marketing expenses.
c. Please align the disclosure relating to the expense limitation agreement in Footnote 4 to the fee table with the description of the expense limitation agreement elsewhere in the registration statement and with the expense limitation agreement itself. For example, “dividend expense on short sales” is listed as an exclusion from the expenses subject to the expense limitation agreement in footnote 4 but not elsewhere in the registration statement.
Response: The Fund has made the requested changes.
5. Comment: The Staff notes that the expense example table was not complete in the latest N-2/A filing. Please complete the table in the next filing.
Response: The Fund confirms a completed expense example table will be completed in the next filing of its Registration Statement.
6. Comment: Under the heading “General Valuation Information” on page 35 of the Prospectus, the Staff notes the following disclosure: “In the event that a pricing service quotation is revised
- 3 - January 10, 2025
or updated subsequent to the day on which the Fund valued such security, the revised pricing service quotation generally will be applied prospectively. Such determination shall be made considering pertinent facts and circumstances surrounding such revision.” Please supplementally explain which pertinent facts the registrant considers when determining how to apply such revisions (ie. whether applied prospectively or retrospectively).
Response: The Registrant notes that it has updated the disclosure under the heading “General Valuation Information” to align with the Fund’s final Valuation Policies and Procedures and has removed this disclosure.
7. Comment: Under the heading “Expense Limitation Agreement” on page 15 of the SAI, the Staff notes disclose stating that the Adviser is entitled to seek reimbursement from the Fund for a three-year period. The Staff notes that elsewhere in the Registration Statement, there is disclosure stating that the Adviser is entitled to seek reimbursement from the Fund for a two-year period. Please align this disclosure with what is provided for in the Expense Limitation Agreement.
Response: The Fund has edited disclosure, where applicable, to reflect that the Adviser is entitled to seek reimbursement from the Fund for a three-year period, as is provided for in the Expense Limitation Agreement.
8. Comment: The Staff notes that the Financial Statements will be filed by amendment. The Staff may have additional comments once those are filed.
Response: The Registrant acknowledges this comment.
Comments Provided on November 22, 2024:
9. Comment: During our September 25th, 2024 call, counsel indicated that Rule 38a-1 policies and procedures are in the works. Please provide a status update.
Response: The Board of Trustees approved the Fund’s Rule 38a-1 Policies and Procedures at its meeting on January 7, 2025. At this same meeting, the Board of Trustees also approved the appointment of Alexander Morgan as the Fund’s CCO to oversee the Fund’s compliance program under Rule 38a-1.
10. Comment: The Fund proposes to accept purchase and sale orders online. Please direct us to, or add any risk disclosure addressing, any risk to the Fund that this could create due to laws the Fund must follow on monitoring for suspicious account activity and protecting sensitive client information.
Response: The Fund has added the following sentence to the Cyber Security Risk disclosure in the Prospectus: “Further, the Fund is subject to certain anti-money laundering and know-
- 4 - January 10, 2025
your-customer laws and regulations, the violation of which could subject it to adverse media coverage, investigations, sanctions, remedial measures and legal expenses, all of which could materially and adversely affect the Fund and its shareholders.”
11. Comment: Please consider briefly clarifying the disclosure in connection with the early references to the Locker regarding the following:
a. The purpose for which the Fund utilizes the Locker. For example, for the preparation of due diligence reports on private companies;
b. That the Locker is a form questionnaire completed by private companies; and
c. That the Fund is not obligated to invest in companies that perform diligence through the Locker.
Response: The Fund has updated applicable disclosure in the Prospectus as follows (newly added text is underlined):
The Fund, under normal circumstances, invests at least 80% of its net assets plus borrowings for investment purposes in Private Companies. Pop Venture Advisers, LLC (the “Adviser”) utilizes a comprehensive, screening, diligence and valuation software (the “Locker”) owned and serviced by CrowdCheck, Inc. (“CrowdCheck”) which is owned by Pop Venture Inc., an affiliate of the Adviser. The Fund utilizes the Locker, which takes the form of a questionnaire, for the preparation of diligence reports on Private Companies. The Locker is available to Private Companies. The Fund will only invest in companies that have a complete and verified Locker but is not obligated to invest in any Private Company which has a complete and verified Locker. Currently no companies are using the Locker. CrowdCheck provides the Adviser and the Fund with diligence services, verifications of potential target issuers’ data and bad actor checks on potential target issuers’ board members, leadership team and investors.
12. Comment: The disclosure on page 2 states that CrowdCheck, Inc. “makes no recommendations with respect to the investability or suitability of an issuer.” Please consider supplemental disclosure stating that the creation of a Locker is not a guarantee of funding.
Response: The Fund has updated the applicable disclosure to state (newly added text is underlined): “CrowdCheck, Inc. makes no recommendations with respect to the investability or suitability of an issuer and the successful completion of an application in the Locker is not a guarantee of funding.”
13. Comment: The disclosure on page 5, under the “Use of Proceeds” heading, states that “[u]nder normal market conditions, the proceeds from the sale of Shares, net of the Fund’s fees and expenses, are invested by the Fund in accordance with its investment objective and policies
- 5 - January 10, 2025
as soon as practicable (but within two (2) years).” Please revise to state that the Fund will invest proceeds within three (3) months.
Response: The Fund will begin sourcing investments immediately upon receipt of proceeds and currently expects to be able to make investments within approximately three months after receipt of proceeds. The Fund has revised the applicable disclosure under the “Use of Proceeds” heading in the Summary Prospectus to state (newly added text underlined, deleted text in strikethrough):
Under normal market conditions, the proceeds from the sale of Shares, net of the Fund’s fees and expenses, are invested by the Fund in accordance with its investment objective and policies as soon as practicable (but within approximately three (3) months) (but within two (2) years), consistent with market conditions and the availability of suitable investments, after receipt of such proceeds by the Fund.
The Fund has also revised the disclosure under the “Use of Proceeds” heading in the Statutory Prospectus to state (newly added text underlined, deleted text in strikethrough):
We anticipate that, due to the nature of the private markets for the types of venture capital investments in which the Fund will invest and factors such as the competitive nature of the business of identifying and structuring investments of the types contemplated by the Fund, the Fund will be able to invest all or substantially all of the net proceeds according to its investment objective and policies within approximately three (3) months within two (2) years after receipt of the proceeds, though subject to depending on the amount and timing of the proceeds available to the Fund as well as the availability of investments consistent with the Fund’s investment objective and policies and prevailing market conditions.
The Fund notes that delays in investing may occur (i) because of the competitive nature of identifying and structuring investments in the types of private capital investments contemplated by the Fund and (ii) becaues of the length of time required to complete diligence on the potential private capital investments (which may be considerable). The Fund additionally notes that the Adviser has a fiduciary obligation to source appropriate investments for the Fund’s investment objective and strategy and the decision as to how and when shareholder assets will be deployed must be undertaken in a manner consistent with its fiduciary obligation. The Adviser must retain flexibility with respect to timing in order to ensure that assets are deployed in the best interests of shareholders.
14. Comment: The disclosure on page 11 under the “Summary of Fund Fees and Expenses” heading indicates that the “contractual expense limitation will remain in effect through January 7, 2026 unless the Board approves its earlier termination.” Please briefly disclose under what circumstances the Board can terminate the contractual expense limitation.
- 6 - January 10, 2025
Response: The Fund has updated the applicable disclosure to state (newly added text is underlined): “This contractual expense limitation will remain in effect through January 7, 2026, unless the Fund’s Board of Trustees approves its earlier termina
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CORRESP
1
filename1.htm
ROPES &
GRAY LLP
191 NORTH WACKER DRIVE
32nd FLOOR
CHICAGO, ILLINOIS
60606-4302
WWW.ROPESGRAY.COM
January 10, 2025 Paulita
A. Pike
T +1 312 845 1212
paulita.pike@ropesgray.com
VIA
EDGAR
Mr. Aaron Brodsky and Ms. Lauren
Hamilton
Securities and Exchange Commission
Division of Investment Management
100 F Street, NE
Washington, D.C. 20002
Re: The
Pop Venture Fund (File Nos. 811-23950 and 333-278367)
Dear Mr. Brodsky and Ms. Hamilton:
On
behalf of The Pop Venture Fund (the “Fund”) set forth below are the Fund’s responses to the comments provided by the
staff (the “Staff”) of the Division of Investment Management of the U.S. Securities and Exchange Commission (the “SEC”)
telephonically on November 7, 2024, November 19, 2024, November 22, 2024, December 23, 2024, and January 3, 2025
relating to the Fund’s Pre-Effective Amendment No. 3 to the Registration Statement on Form N-2 (File Nos. 811-23950 and
333-278367) (the “Registration Statement”) filed on October 28, 2024. The Staff’s comments are set forth below
and are followed by the Fund’s responses. Capitalized terms used but not defined herein have the same meaning as set forth in the
Registration Statement.
Comments Provided
on November 7, 2024:
1. Comment:
Please supplementally explain whether a company would seek a diligence report from CrowdCheck
if it was not seeking an investment from The Pop Venture Fund.
Response:
CrowdCheck is a company which conducts and prepares diligence reports for variety of clients, not only the Adviser. Other companies and/or
potential investors may contract with CrowdCheck to prepare a diligence report on a potential target investment company. Pop Venture
is not the only entity using CrowdCheck’s services.
2. Comment:
In connection with the response to comment #17 in the Fund’s October 11, 2024
comment response letter, please confirm supplementally that there are no conflicts among
CrowdCheck’s operation of the Locker and the Fund and its investors, aside from the
conflict-of-interest disclosure that the Fund added in connection with its response to comment
#1 in
- 2 - January 10, 2025
the Fund’s
August 7, 2024 comment response letter (providing the use of an affiliated service provider).
If the Fund’s position is that there are no conflicts at all, please advise.
Response:
The Fund confirms that there are no conflicts among CrowdCheck’s operation of the Locker and the Fund and its investors other than
the potential for conflicts of interest with respect to the use of an affiliated service provider (as outlined in the conflict-of-interest
disclosure added to the Registration Statement in response to comment #1 of the August 7, 2024 comment response letter).
3. Comment:
Please disclose in the principal strategies section of the Fund’s prospectus how the
Fund is defining “venture company,” as that term is used in the Fund’s
definition of private company.
Response:
The Fund has added disclosure in the principal strategies section of the Fund’s prospectus stating “Venture companies are
early- through growth-stage companies with high growth potential, in multiple sectors.”
Comments Provided
on November 19, 2024:
4. Comment:
With respect to the fee table on page 10 of the Prospectus:
a. Please
add a footnote detailing the term of the management fee.
b. Please
align the presentation of the Annual Fund Expenses with format provided in Form N-2,
specifically with reference to the presentation of the marketing expenses.
c. Please
align the disclosure relating to the expense limitation agreement in Footnote 4 to the fee
table with the description of the expense limitation agreement elsewhere in the registration
statement and with the expense limitation agreement itself. For example, “dividend
expense on short sales” is listed as an exclusion from the expenses subject to the
expense limitation agreement in footnote 4 but not elsewhere in the registration statement.
Response:
The Fund has made the requested changes.
5. Comment:
The Staff notes that the expense example table was not complete in the latest N-2/A filing.
Please complete the table in the next filing.
Response:
The Fund confirms a completed expense example table will be completed in the next filing of its Registration Statement.
6. Comment:
Under the heading “General Valuation Information” on page 35 of the Prospectus,
the Staff notes the following disclosure: “In the event that a pricing service quotation
is revised
- 3 - January 10, 2025
or updated subsequent
to the day on which the Fund valued such security, the revised pricing service quotation
generally will be applied prospectively. Such determination shall be made considering pertinent
facts and circumstances surrounding such revision.” Please supplementally explain which
pertinent facts the registrant considers when determining how to apply such revisions (ie.
whether applied prospectively or retrospectively).
Response:
The Registrant notes that it has updated the disclosure under the heading “General Valuation Information” to align with the
Fund’s final Valuation Policies and Procedures and has removed this disclosure.
7. Comment:
Under the heading “Expense Limitation Agreement” on page 15 of the SAI,
the Staff notes disclose stating that the Adviser is entitled to seek reimbursement from
the Fund for a three-year period. The Staff notes that elsewhere in the Registration Statement,
there is disclosure stating that the Adviser is entitled to seek reimbursement from the Fund
for a two-year period. Please align this disclosure with what is provided for in the Expense
Limitation Agreement.
Response:
The Fund has edited disclosure, where applicable, to reflect that the Adviser is entitled to seek reimbursement from the Fund for a three-year
period, as is provided for in the Expense Limitation Agreement.
8. Comment:
The Staff notes that the Financial Statements will be filed by amendment. The Staff may have
additional comments once those are filed.
Response:
The Registrant acknowledges this comment.
Comments Provided
on November 22, 2024:
9. Comment:
During our September 25th, 2024 call, counsel indicated that Rule 38a-1 policies
and procedures are in the works. Please provide a status update.
Response:
The Board of Trustees approved the Fund’s Rule 38a-1 Policies and Procedures at its meeting on January 7, 2025. At this
same meeting, the Board of Trustees also approved the appointment of Alexander Morgan as the Fund’s CCO to oversee the Fund’s
compliance program under Rule 38a-1.
10. Comment:
The Fund proposes to accept purchase and sale orders online. Please direct us to, or add
any risk disclosure addressing, any risk to the Fund that this could create due to laws the
Fund must follow on monitoring for suspicious account activity and protecting sensitive client
information.
Response:
The Fund has added the following sentence to the Cyber Security Risk disclosure in the Prospectus: “Further, the Fund is subject
to certain anti-money laundering and know-
- 4 - January 10, 2025
your-customer laws and regulations,
the violation of which could subject it to adverse media coverage, investigations, sanctions, remedial measures and legal expenses, all
of which could materially and adversely affect the Fund and its shareholders.”
11. Comment:
Please consider briefly clarifying the disclosure in connection with the early references
to the Locker regarding the following:
a. The
purpose for which the Fund utilizes the Locker. For example, for the preparation of due diligence
reports on private companies;
b. That
the Locker is a form questionnaire completed by private companies; and
c. That
the Fund is not obligated to invest in companies that perform diligence through the Locker.
Response:
The Fund has updated applicable disclosure in the Prospectus as follows (newly added text is underlined):
The
Fund, under normal circumstances, invests at least 80% of its net assets plus borrowings for investment
purposes in Private Companies. Pop Venture Advisers, LLC (the “Adviser”) utilizes a comprehensive, screening, diligence
and valuation software (the “Locker”) owned and serviced by CrowdCheck, Inc. (“CrowdCheck”)
which is owned by Pop Venture Inc., an affiliate of the Adviser. The Fund utilizes the Locker, which takes the form of a questionnaire,
for the preparation of diligence reports on Private Companies. The Locker is available to Private Companies. The Fund will only invest
in companies that have a complete and verified Locker but is not obligated to invest in any Private Company which has a complete and
verified Locker. Currently no companies are using the Locker. CrowdCheck provides the Adviser and the Fund with diligence services,
verifications of potential target issuers’ data and bad actor checks on potential target issuers’ board members, leadership
team and investors.
12. Comment:
The disclosure on page 2 states that CrowdCheck, Inc. “makes no recommendations
with respect to the investability or suitability of an issuer.” Please consider supplemental
disclosure stating that the creation of a Locker is not a guarantee of funding.
Response:
The Fund has updated the applicable disclosure to state (newly added text is underlined): “CrowdCheck, Inc. makes no
recommendations with respect to the investability or suitability of an issuer and the successful completion of an application in the
Locker is not a guarantee of funding.”
13. Comment:
The disclosure on page 5, under the “Use of Proceeds” heading, states that
“[u]nder normal market conditions, the proceeds from the sale of Shares, net of the
Fund’s fees and expenses, are invested by the Fund in accordance with its investment
objective and policies
- 5 - January 10, 2025
as soon as practicable
(but within two (2) years).” Please revise to state that the Fund will invest
proceeds within three (3) months.
Response:
The Fund will begin sourcing investments immediately upon receipt of proceeds and currently expects to be able to make investments within
approximately three months after receipt of proceeds. The Fund has revised the applicable disclosure under the “Use of Proceeds”
heading in the Summary Prospectus to state (newly added text underlined, deleted text in strikethrough):
Under normal
market conditions, the proceeds from the sale of Shares, net of the Fund’s fees and expenses, are invested by the Fund in accordance
with its investment objective and policies as soon as practicable (but within approximately three (3) months) (but within
two (2) years), consistent with market conditions and the availability of suitable investments, after receipt of such proceeds
by the Fund.
The Fund
has also revised the disclosure under the “Use of Proceeds” heading in the Statutory Prospectus to state (newly added text
underlined, deleted text in strikethrough):
We anticipate
that, due to the nature of the private markets for the types of venture capital investments in which the Fund will invest and factors
such as the competitive nature of the business of identifying and structuring investments of the types contemplated by the Fund, the
Fund will be able to invest all or substantially all of the net proceeds according to its investment objective and policies within
approximately three (3) months within two (2) years after receipt of the proceeds, though subject to depending
on the amount and timing of the proceeds available to the Fund as well as the availability of investments consistent with the
Fund’s investment objective and policies and prevailing market conditions.
The Fund
notes that delays in investing may occur (i) because of the competitive nature of identifying and structuring investments in the
types of private capital investments contemplated by the Fund and (ii) becaues of the length of time required to complete diligence
on the potential private capital investments (which may be considerable). The Fund additionally notes that the Adviser has a fiduciary
obligation to source appropriate investments for the Fund’s investment objective and strategy and the decision as to how and when
shareholder assets will be deployed must be undertaken in a manner consistent with its fiduciary obligation. The Adviser must retain
flexibility with respect to timing in order to ensure that assets are deployed in the best interests of shareholders.
14. Comment:
The disclosure on page 11 under the “Summary of Fund Fees and Expenses”
heading indicates that the “contractual expense limitation will remain in effect through
January 7, 2026 unless the Board approves its earlier termination.” Please briefly
disclose under what circumstances the Board can terminate the contractual expense limitation.
- 6 - January 10, 2025
Response:
The Fund has updated the applicable disclosure to state (newly added text is underlined): “This contractual expense limitation
will remain in effect through January 7, 2026, unless the Fund’s Board of Trustees approves its earlier termina