Sustainability related disclosures
Art. 10 SFDR – Sustainability-related information about financial products that promote environmental or social characteristics
w3.fund management GmbH (“w3.fund management”) is the alternative investment fund manager of w3.fund ventures I GmbH & Co. KG (the “w3.fund I”) within the meaning of the German Investment Code (Kapitalanlagegesetzbuch, KAGB) and as such publishes the following information in light of the consideration of sustainability-related aspects in accordance with Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability disclosure requirements in the financial services sector (the “SFDR”).
This financial product promotes environmental or social characteristics but does not have as its objective a sustainable investment. The promoted characteristics are investment restrictions. 100% of the investments will be in line with its investment strategy and investment restrictions.No reference benchmark has been designated to attain the environmental or social characteristics promoted by the financial product.
No sustainable investment objective
This financial product promotes environmental or social characteristics but does not have as its objective sustainable investment.
Environmental or social characteristics of the financial product
The promoted characteristics of this product are investment restrictions:
• casinos and equivalent enterprises
• adult entertainment
• weapons or weapon systems
• production of and trade in tobacco and distilled alcoholic beverages
• or areas directly supporting the development of such sectors
w3.fund I intends to seek long-term capital appreciation mainly through equity and quasi-equity investments in early-stage technology companies with a connection to Web3 primarily in Europe as well as Crypto Investments.
Policy to assess good governance practices of the investee companies
As part of the due diligence and ongoing investment management, the investment team will review whether a potential investee company has good governance practices in place. This might include using ESG (environmental, social, and governance) criteria to evaluate companies' performance in areas such as labor practices, human rights, and corporate governance, conducting due diligence on investee companies to assess their management structures, employee relations, and tax compliance, engaging with investee companies through to encourage improvements in governance practices if necessary. The intensity of the assessment is carried out in accordance with the principle of proportionality. Where the manager sees higher risks of non-compliance, they will intensify the audit.
Proportion of investments
w3.fund I will invest fully in line with its investment strategy and investment restrictions. w3.fund I will not invest a portion of its capital in any other asset class.
Monitoring of environmental or social characteristics
The investment team for w3.fund I will initially and continuously monitor whether the investment restrictions are abided by and whether the investment falls within the investment policies.w3.fund I will not make any investment in the excluded sectors unless previously approved by the advisory committee. Therefore, the achievement of the promoted ESG aspects – no investment within the excluded sectors – can be tracked in a simple way.
Methodologies for environmental or social characteristics
See above. The exclusion list is used to measure how the social or environmental characteristics promoted by the financial product are met.
Data sources and processing
w3.fund I receives data provided by the portfolio companies as part of the due diligence process and at regular intervals after the investment. Where necessary or beneficial, w3.fund I also makes use of publicly available data. Data processing is exclusively internal and DSGVO compliant. Estimates of data are not made.
Limitations to methodologies and data
w3.fund management is partly reliant on the information provided by portfolio companies during the due diligence process. Moreover, in the post-investment phase, w3.fund management is reliant on the company’s reported data. In both cases, complete data may not always be available due to the nature of the investments. The information is verified only if and to the extent misrepresentations are suspected.Since w3.fund I’s investments are made for a multi-year investment period, w3.fund management places a high priority on establishing a trusting working relationship with the portfolio companies to ensure that data is submitted reliably and completely and that the above restrictions are met.
w3.fund management considers the promoted ESG aspects when sourcing new portfolio companies for w3.fund I and during the due diligence on targeted portfolio companies. The due diligence is performed by obtaining all information relevant to w3.fund I using a due diligence questionnaire, which is then reviewed internally. If necessary, further specific information is also obtained from the potential portfolio companies, should this still be necessary after the detailed questioning. The due diligence process is not externally monitored.
Last Version: 20.07.2023