Iberis is extending the Greytech II fund lock-in... probably without your knowledge or consent.

While the future of the ARI program hangs in the balance, Iberis Capital is not wasting any time protecting their interests.

Iberis is quietly, without any warning or discussion, extending the lock-in of the venture capital fund effectively holding the participants’ funds for twice the amount of time required to qualify for a GV.

If the GV program is canceled or future renewals are affected, then everyone will want their money back and that would be awfully inconvenient for them.

On 28 March the Avogado for the fund/Iberis sent out a convening notice for the Iberis Greytech fund Annual General Meeting (AGM) and deep in the fine print (on page 14) is a proposed change to the fund duration extending it by two years. Nowhere else in the Annual Report, the Auditor’s report, in the covering email or anywhere else has Iberis bothered to explain what they are doing and why.

If you are a participant and received the fund documents, ask yourself: before reading this post did you know about the proposed two-year forced extension? They are doing it quietly because the Limited Partnership Agreement (LPA) is in their favor – this is not a problem; we knew that when we signed. Only the Management Company (Iberis) can propose any changes and these are adopted by 2/3rd of the votes cast.

But please note: the meeting takes decisions regardless of the number of unit-holders present or represented and the capital they represent. The resolutions of the meeting of unit-holders are binding on the holders of units who did not attend the meeting, as well as those who abstained or voted against. So if people do not vote against the resolution (which is what they are counting on), then even one unopposed FOR vote will pass it and make it binding on the entire fund and every participant.

The LPA already allows for 2 x 2yr extensions to the fund but these are optional and they are leaving those unchanged. Instead they are making a compulsory extension. They could have left everything unchanged, made 25% per year return each year and then suggested to the participants to exercise an optional extension but they don’t want to take that risk.

Iberis are duty bound to treat all participants justly and fairly and also to make all decisions in the exclusive interest of the participants. They are clearly not doing so here. I am sure CMVM would agree with me. I expect Iberis will take a dim view of this post and try and explain otherwise while saying they are complying with the law / LPA etc. You can make up your own mind. They are using the system to their advantage in an opaque, underhanded and predatory manner.

The good news is that it’s not too late. If you want to stop Iberis, here’s how:

If you are a participant in Greytech II and you do not want the forced two-year extension to go ahead then either:

a) Complete your ‘Declaration of Vote’ and email it to them by 1pm (Lisbon time) on 14 April. OR
b) Attend the meeting on 18 April (by video conference or in person) and vote AGAINST Item #4 on the agenda. OR
c) Have your proxy attend the meeting and vote AGAINST item 4 on the agenda.

Instructions for each of these options are laid out in the email with the Convening Notice which you should have received on 28 March from Bernardo Abreu Mota | CS’Associados.

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I’m not quite sure where you are getting this:

As you stated above, they sent you a proposal for a discussion to take place at the annual meeting.

I am an investor in the Iberis Greytech II fund and I have a few conversation with them regarding the progress of the fund. I have come away with this being a solid well managed fund and on track to do well despite some significant hurdles such as rising energy costs, ect.

I know myself and a few other investors in the fund have expressed concern over whether the fund will last long enough for us to obtain citizenship. I am only at the biometric stage. I got my biometrics last month and we are leaving for Portugal today for the family’s biometrics. Their proposal was to extend the fund by two years to ease our concerns. They felt confident that they could continue to perform. They have been on the conservative side in deploying capital and can continue to do so with the extension. Also my thought is that it brings this fund into a more typical 8-10 year middle market investment timeline.

Ofcourse, I understand everyone’s situation is different. Which is why this proposal is up for a vote at the annual meeting.


Thank @Rivahbrew for your response.

You ask where I got ‘quietly, without any warning or discussion’. I can confirm the first I heard about this change was on 28 March when a vote was requested. No explanation or discussion preceded that and no explanation accompanied the convening notice either.

I also am happy to be corrected - outside of your personal communication with them, do you have any knowledge that the managers communicated with all the participants about an extension before calling a meeting requiring it to be voted on?

About your not having enough time before citizenship concern - I can see where you are coming from. Just to remind you:
a) the requirement to invest in a VC fund under ARI is minimum 5 years, and
b) the fund already has 2 x 2year optional extensions available to accommodate people who may require more time to remain invested. That would bring the total fund duration to 12 years.

If even 12 years was not enough time, they could have proposed increasing the two optional extensions to three optional extensions.

A two-year forced extension is a substantive change being pushed along like an administrative correction. All the members can make up their own minds on the merits of the extension, I am just trying to get the word out about the proposal and that members need to vote.

In my view, the proposal as it stands, ought to fail.

I also don’t understand your “quietly, without any warning or discussion” comment and why you are upset. This is how venture capital works — they send out proposed changes to investors to vote on at the meeting. At the meeting, they will discuss why they propose the changes and you get to ask questions.


I am an investor of the fund in early days. Knowing a lot ppl invested in the Dec 2021. I was suggesting to the fund manager to extend the tenor of the fund by at least 2 years with due consideration that a minority of investors do not want to extend.


Just to add, I am supportive of the change Iberis is proposing for these exact same reasons. I’m still waiting on my card (biometrics done), and we’re coming up on 2 years since I made the investment in GreyTech II. I’d rather extend the fund and not have to worry about the fund expiring before my 5 years are up.

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This exact thing is why I always thought these funds were a terrible idea fwiw.

Some want to extend to make sure they can finish their 5 years while others are waiting to get their money out and being held hostage by the ones that need it to go longer.

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I understand why some investors are concerned about the life of the fund and SEF delays.

It doesn’t really make sense to me right now (without their explanation) that they want to extend the period to 10 years with 2/2 years optional when more than half of the capital is currently uninvested. However, the proposed change to 1 more year of investment period (5 years with 2/2 optional), I have no reservations.

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Maybe I’m missing something, but the original LPA already has the option to extend term for another 4 years (2x2). As it is, 12 years is a long time to have our money locked up; why agree to a potential 14 years, and why now?

The 2x2 is optional and thus, it has to be voted for. There is a chance that it won’t pass the majority. The proposed change to 10 (2x2) is giving them a guaranteed 10 years instead of the original 8.

Yeah, I get that. I’m just not clear why they think they need more than 12 years. Instead of increasing initial the from 8 to 10, they could request the 1st 2 year extension. Or wait till we’re at least on the back half of the initial term to be asking for any extension.

I agree. The only logical explanation I can think of is that they have an investment in the pipeline that requires more than 6 years to divest. This could be a requirement from the company they want to invest in — that they want a guaranteed length of time. (the fund is about 2 years old now and so we only have 6 more of the guaranteed period).

The more interesting change, though, is they only proposed one more extra year for the investment period from 4 years (2+2) to 5 years (2+2).

I’ve asked for a call to get more insight, as I can’t make the meeting on the 18th. Will let you know what I hear.

Thank you!

Funds aren’t all generally bad. Honestly, nobody would have an issue here if Iberis was exercising one of the agreed (optional) extensions or adding another optional extension to serve the recent entrants. With optional extensions, people who want out can get out. The main issue here is that they are trying to extend the minimum mandatory term after the fact.

Thank you all for the inputs. I see some people are as perplexed as me (if not as riled up) as to ‘why’ and ‘how’ this has been proposed and is being handled. We will have to wait and see what finally becomes of it.

The way the LPA is drawn up, it favors the management company. If they propose a resolution, it is most likely going to pass rather than not. Most participants wont/don’t read the paperwork sent to them. Just to remind you:

@mgotuaco Thank you for this:

Winnie, the fund is 2 year and 3 month old.
Below is what I gathered earlier this year

  1. a couple of opportunities supposed to be materialised earlier were dropped;
  2. therefore anticipation of investing most of the capital by end of 2023 may not be realistic.

The start date of the fund is 4th Jan 2021. As things stand the investment period continues right through 2024 (not end of 2023). Even after that date, they can make further investments in existing investments but not initiate new ones.

FWIW, I have no reservations in extending the investment period by the Iberis suggested one year (to 3rd Jan 2026) as long as there is no change to the minimum fund duration. Optional extensions to the fund duration are also fine in my book as it will secure the recent entrants the time they need for their peace of mind.

You can’t really blame the investment companies for this. It’s the participants’ responsibility to read the agreements or contracts before we sign or make any decisions.

@rogergan68 Thanks for the input. If that’s the case, it looks more like they want to reset the life of the fund, which is very unfortunate. We are loosing about 6% a year on inflation on the uninvested portion of the funds.

For those of us GV holders who are worried about the life of the funds and SEF renewals, (I talked to our lawyer about this awhile ago, but don’t really remember all the details) I believed we can change our investment. We can invest in IMGA (a mutual fund trading on the PT stock market) or another investment when we need to. But again, we don’t know what the future holds since the government is talking about scrapping/changing GV requirements.

Iberis just sent out the summary of the changes and their rationale. To be honest, it is not the right time to change the life of the fund for the reason they listed especially when PT government is looking to change GV requirements. If the changes from the PT government make the majority of us needing to scrap Portugal GV, we may want to pull our money out sooner. At least, we should wait until we know what GV changes will be before making any changes to the fund.
Just my 2 cents.