5. Phased Roadmap

Capital Delta's development is structured across five distinct phases, each with specific objectives, organizational requirements, and regulatory milestones. This phased approach allows us to build a solid foundation before scaling to a fully regulated asset manager.

Overview of Phases

Phase 0 – Track-Record Consolidation (Prop Trading) | 24-36 months

Establishing our track record as a proprietary trading firm, refining our strategies, and building our core technology infrastructure.

Phase 1 – Compliance Architecture & SOPs | 12-18 months

Developing the compliance framework, standard operating procedures, and governance structures necessary for regulatory approval.

Phase 2 – Regulated Manager Formation | 12-18 months

Obtaining initial regulatory licenses (SGEIC/SGIIC or Sub-Threshold AIFM) and establishing the legal entities required for fund management.

Phase 3 – Fund Launch & Seed Capital | 6-12 months

Launching our first investment fund, securing seed capital, and establishing relationships with service providers.

Phase 4 – Institutional Scale-Up to Full AIFM | 18-24 months

Scaling to a full-scope Alternative Investment Fund Manager (AIFM), expanding our investor base, and enhancing our institutional infrastructure.

Phase Details

Each phase is detailed below, covering:

Objectives & KPIs: Specific goals and key performance indicators for each phase
Organizational Structure: How our team and governance evolve through each phase
Management Team & Key Hires: Critical roles and recruitment priorities
Technology & Operations: Infrastructure development and operational improvements
Compliance & Regulatory Steps: Licensing requirements and compliance frameworks
Timeline & Budget: Expected duration and capital requirements

Current Status

We are currently in Phase 0, focused on building our proprietary trading track record and refining our core technology stack. Key milestones achieved to date:

Development of automated options trading framework
Implementation of risk management systems
Establishment of exchange connectivity to major venues
Initial performance metrics showing promising results ( see Traction & Proof Points)

Next Steps

Our immediate focus is on completing Phase 0 and preparing for the transition to Phase 1, which involves:

Completing a 24-month audited track record
Finalizing our core strategy suite
Developing preliminary compliance documentation
Engaging with regulatory consultants

Detailed Phase Descriptions

Phase 0: Track-Record Consolidation (Prop Trading)

Objectives & KPIs

Establish a minimum 24-month audited track record with Sharpe > 1.8
Develop and refine core trading strategies across multiple asset classes
Build and test the full technology stack for automated trading
Achieve consistent monthly returns with max drawdown < 15%

Organizational Structure

Lean structure with founders/partners overseeing all operations
Two main divisions: Trading & Research and Technology
External service providers for accounting, legal, and compliance

Management Team & Key Hires

Core team of founders operating the business
Engage consultants for specialized needs (legal, regulatory)
Begin identifying candidates for Phase 1 key hires

Technology & Operations

Develop and implement automated trading systems
Establish connectivity to major exchanges and venues
Build risk management and monitoring tools
Create backtesting and simulation environment

Compliance Considerations

Operate as a proprietary trading entity
Establish basic compliance framework and documentation
Begin research on regulatory requirements for future phases

Timeline & Budget

Duration: 24-36 months
Capital Requirements: $250,000 - $500,000
Key Milestones: Complete technology stack (Month 12), Audited track record (Month 24)

Phase 1: Compliance Architecture & SOPs

Objectives & KPIs

Develop comprehensive compliance framework and policies
Create standard operating procedures for all business functions
Prepare documentation for regulatory applications
Continue building track record with improved performance metrics

Organizational Structure

Expand structure to include dedicated compliance function
Formalize management committee and reporting lines
Implement governance controls and oversight mechanisms

Management Team & Key Hires

Hire Compliance Officer/Consultant
Recruit additional technology resources
Engage regulatory consultants and legal counsel

Technology & Operations

Implement compliance monitoring and reporting systems
Enhance risk management framework
Develop audit trails and record-keeping systems
Establish business continuity and disaster recovery procedures

Regulatory Milestones

Complete regulatory gap analysis
Prepare application materials for SGEIC/SGIIC license
Engage with regulators for preliminary discussions

Timeline & Budget

Duration: 12-18 months
Capital Requirements: $500,000 - $750,000
Key Milestones: Compliance framework (Month 6), Regulatory application preparation (Month 12)

Phase 2: Regulated Manager Formation

Objectives & KPIs

Obtain initial regulatory license (SGEIC/SGIIC or Sub-Threshold AIFM)
Establish legal entities for fund management
Develop fund documentation and marketing materials
Secure seed commitments for first fund

Organizational Structure

Implement regulated entity structure with appropriate controls
Establish board of directors with independent members
Form investment committee and risk committee

Management Team & Key Hires

Appoint regulated entity officers (CEO, CIO, etc.)
Hire Head of Research and Head of Trading Operations
Expand technology and operations team

Technology & Operations

Upgrade systems to meet regulatory requirements
Implement portfolio management and reporting systems
Establish connections with fund administrators and custodians

Legal & Compliance Steps

Complete regulatory licensing process
Draft fund documentation (PPM, LPA, etc.)
Establish compliance monitoring program

Timeline & Budget

Duration: 12-18 months
Capital Requirements: $1,000,000 - $1,500,000
Key Milestones: Regulatory approval (Month 12), Fund documentation (Month 15)

Phase 3: Fund Launch & Seed Capital

Objectives & KPIs

Launch first investment fund with minimum viable AUM
Establish relationships with service providers
Implement institutional-grade operational infrastructure
Begin marketing to qualified investors

Organizational Structure

Expand team to support fund operations
Implement full investment process and oversight
Establish investor relations function

Management Team & Key Hires

Hire COO or Head of Operations
Expand investment team with additional analysts
Add investor relations professional

Technology & Operations

Implement full-scale portfolio management system
Establish comprehensive reporting capabilities
Integrate with fund administrator and custodian systems

Fund Documentation & Service Providers

Finalize all fund documentation
Appoint fund administrator, custodian, and auditor
Establish prime broker relationships

Timeline & Budget

Duration: 6-12 months
Capital Requirements: $1,500,000 - $2,000,000
Key Milestones: Fund launch (Month 6), First closing (Month 9)

Phase 4: Institutional Scale-Up to Full AIFM

Objectives & KPIs

Upgrade to full-scope AIFM license
Expand AUM to €250+ million
Develop additional fund products
Establish global presence with multiple office locations

Organizational Structure

Implement full institutional structure
Expand board with additional independent directors
Establish regional teams for global operations

Management Team & Key Hires

Expand executive team with specialized roles
Add regional heads for international expansion
Build out full investment, technology, and operations teams

Technology & Operations

Implement enterprise-grade systems and infrastructure
Establish global trading capabilities
Develop proprietary analytics and research platforms

Compliance with AIFMD II

Upgrade compliance framework to meet full AIFMD requirements
Implement enhanced risk reporting and disclosures
Establish comprehensive ESG framework

Timeline & Budget

Duration: 18-24 months
Capital Requirements: $3,000,000 - $5,000,000
Key Milestones: AIFM approval (Month 12), €250M AUM (Month 24)