By Hamlin Lovell, NordicInvestor

How can investors combine exposure to cutting edge venture capital investing, with daily liquidity? A new hybrid vehicle, combining a fund of funds with direct investments into private companies, could be a solution.

Peter Dahlgren, a seasoned banking and insurance leader in the Nordics, has developed a real passion for technology ventures, investing his own family office capital, alongside 50 other high net worth individuals – with spectacular success. In just four years, the Confidus Venture Capital fund that he founded in 2019 has made three investments and increased in value sixfold. Dahlgren thinks this is just the beginning: “AI, digital transformation and automation is the biggest wave of value creation in the history of mankind, and our ecosystem of competence is a leading team in this region. The unique companies that we back, such as enablement platform EvolutIQ, have gross margins between 75% and 90%, are scaling 100% per year, and have non-linear business models. They should either raise more capital at much higher valuations, or do IPOs, perhaps on Nasdaq Sweden or in some cases global businesses should list in the US”.

Dahlgren chairs the board of no code/low code hyper-automation enablement platform, EvoluteIQ, which has received multiple awards, including recognition in the 2021 Gartner Market Guide as a leading vendor in AI automation for large companies (35% of its customer base are global Fortune 200 companies). It raised a large pre-IPO financing round in late 2023 and expects to list in 2025.

Successful exits also create a need for liquidity management, while waiting for the next initial or follow on investments. Therefore, DCAP Select will also act as a liquidity management vehicle for Dahlgren, some other investors in the venture capital deals, and potentially other groups of investors. DCAP is not in fact being actively marketed and promoted, though investors have the opportunity to invest alongside Dahlgren – in both venture capital and liquid markets.

DCAP has a completely unconstrained “go anywhere” mandate, though its base case target is 30% in venture capital – a figure that will naturally fluctuate with valuations, exits and investments for the venture capital investments, and net inflows or outflows for DCAP overall.

Liquid Fund Allocations

The other 70% is in liquid funds. The approach is not to make aggressive short term tactical bets, though the strategic asset allocation does vary with relative valuation measures and opportunities. “We aim for the highest returns given balanced risk, and expect the majority – over 90% – of returns on the liquid allocations will come from asset allocation,” says Dahlgren. The asset allocation is determined by Dahlgren along with Hans Sterte who chairs the investment committee.  Sterte, who has a strong track record, is something of a legend in Sweden, having been CIO of Länsförsäkringar, CIO of Skandia and CIO of Alecta, each for multi-year periods. The team also includes, Klas Eklund, a respected macroeconomist with over 20 years at SEB, whose views will also feed into the asset allocation.

They will generally will draw ideas from 65 or so leading investment funds researched by business developer, House Of Reach, where Sterte is Senior Partner. HoR has demonstrated its confidence in DCAP by taking a stake of  approximately 25% in the DCAP management company, while Dahlgren owns most of the rest. (DCAP is however also free to select other funds if HoR has not shortlisted one in a particular asset class or strategy that the investment committee want to allocate to).

In early 2024, the DCAP team see the best risk reward in corporate credit, and expect it could be a 40% weighting, with only 30% in equities, and 30% in the venture capital. “Corporate credit is attractive because now is the easiest time in 25 years to make a 10% return, due to base interest rates and credit spreads. We can make 10% without taking too much risk,” expects Dahlgren. He does not expect equities can compete with this sort of risk/reward ratio , but over time he envisages steadily migrating to equities as interest rates and credit spreads come down.

Within equities, Dahlgren has strong opinions on country selection in emerging markets. “China is the biggest loser from geopolitics and trade wars, and is hurting its own economy with socialist decisions. India is the biggest winner from geopolitics and is much more western friendly”. An Indian small caps fund has been shortlisted, alongside small caps in the Nordics and the US, which trade on lower valuations than large caps. HoR recommended funds can be run by boutique asset managers, such as Sweden’s Origo, or much larger ones, such as Rockefeller Asset Management in New York or Aviva in the UK.

Most of the shortlisted funds follow a traditional discretionary fundamental approach to investing, though one systematic/quantitative multi strategy fund has been identified.

Mitigating Liquidity Mismatches

The Luxembourg CSSF regulator is worried about liquidity mismatches have since 2020 prevented UCITS funds from investing in bank loans; however the RAIF fund structure used for DCAP allows more freedom. Potential for liquidity mismatches between DCAP’s venture capital investments, and daily liquidity on the Luxembourg RAIF fund, is mitigated in two ways.

Dahlgren explains: “only more mature venture capital investments approaching profitability and IPOs will be held by the DCAP fund (one investment in Confidus, DLT cross border payment solutions group, Centiglobe, is not yet mature enough to be considered for DCAP)”. 

And he expects to be personally the largest investor in DCAP Select, acting as a kind of liquidity buffer to absorb any shocks – if there were ever net outflows from other investors, he would be happy to let the venture capital share of the fund rise, and would not himself need to redeem. (Dahlgren declined disclose the amount he will commit to DCAP Select for this article).


The initial entry points for the contemplated venture capital investments in EvolutIQ, and online car advertising platform Phyron, will be based on the last capital raise for each investment. These holdings will subsequently be valued using a third party agent and DCAP will be audited by PwC Luxembourg.

DCAP Select proposes to charge a 0.95% management fee and 12% performance fee.

(By way of comparison, Confidus Venture Capital charges zero management fee and 25% performance fee).


Though one of the shortlisted funds – Aviva Climate Transitions Credit – does explicitly include climate in its mandate, there is no specific climate target for DCAP. There is a broad objective to invest sustainably and avoid companies with a bad climate policy. DCAP Select should report under SFDR article 6.