Social Capital Emerging Managers 2022

At the beginning of 2021, Social Capital hired its inaugural class of Emerging Managers (EMs) – a
program designed to stake promising managers with an initial base of capital, investing infrastructure, and
other resources needed to manage their own portfolio.

We launched this program with the goal of identifying untapped and underutilized individuals who are
eager to take the next step in their investment career, without needing to endure the years it typically
takes to advance within traditional investment organizations.

Social Capital’s EM platform offers three unique and compelling advantages:

1. Long-term capital commitment. In an industry where managers are scrutinized by day-to-day

performance and risk losing capital commitments in a matter of weeks or months, Social Capital
makes a minimum three-year commitment to its EMs. With this peace of mind, EMs are
empowered to think about their capital allocation strategies with a long-term view and an
understanding that some strategies may have longer time horizons than others.
2. Best-in-class investing platform. In addition to the basic operational infrastructure and tools to
manage a fund (e.g., trading systems, research, etc.), EMs benefit from a support system to
collaborate and learn alongside Social Capital’s investing partners. EMs may also be tapped to
assist with Social Capital’s new and existing investments and other projects.
3. Audited track record. Unlike most investment platforms, we empower EMs to own their track
record during and after their time at Social Capital. We provide audited financials that managers
are free and encouraged to take with them should they decide to raise outside capital.

EM Class of 2021 – Year 1 Summary

While the inaugural year proved challenging at times amidst a volatile 2021, we are pleased with the EMs’
early progress and continue to make refinements to the program. On March 1st, each EM was staked
with an initial capital base of $4 million each, and we have allocated additional funding since.

March to December 2021 Returns Top Holdings1

Manager 1 38.5% Perimeter Medical 5.2%
Manager 2 22.3% Alphabet 3.4%
Manager 3 12.0% Amazon 2.9%
Manager 4 8.8% Microsoft 2.8%
Manager 5 6.7% XPEL 2.0%
Manager 6 -7.2% Meta Platforms 1.9%
Manager 7 -7.8% Salesforce.com 1.9%
Manager 8 -16.2% Liquidia 1.9%
Manager 9 -20.7% Visa 1.9%
Manager 10 -24.7% Twilio 1.8%
Manager 11 -28.5% Others 74.3%
Overall 0.1% Total 100.0%

1
Based on total NAV as of December 31, 2021
About EM Class of 2021

● Total: 11 managers
● Gender: 8 Male; 3 Female
● Race/ethnicity: 6 White; 5 BIPOC
● Age: 20s (2); 30s (5); 40s (4)
● Backgrounds: Hedge funds, long only funds, family offices, veterans
● Locations: New York, California, Florida, North Carolina

EM Class of 2022 – Call for Applicants

We are excited to announce a call for applications for the incoming Class of 2022 EMs. To apply,
candidates should make a written submission in three pages or less discussing their background,
investment strategy, and approach for generating outsized returns on an initial capital base of between
$1M to $5M that can potentially scale over time to tens or hundreds of millions of dollars.

This year, in addition to US traded equities (all strategies), applicants may also present actively managed
liquid crypto strategies (CEX trading/DEX trading/Yield Farming).

In addition to your strategy and approach, successful applications may touch on the following, though no
specific format is expected and none are required:

● Current best idea

● Example trades
● Thoughts on portfolio construction and/or risk management
● Track record (if available) or backtest performance
● Social media profile/blogs/public research

For consideration, please email your application to EM@socialcapital.com by February 11, 2022. Full
terms can be found in our standard term sheet.
Emerging Manager Term Sheet

Social Capital has a standard deal for all new managers. We stake each manager with an initial allocation
of $1M to $5M depending on experience and strategy for a minimum period of three years. There is no
fee to apply, no requirement to co-locate, and no capital contribution will ever be due. Each individual will
be tasked with executing their own strategy and contributing to a shared community of investors. In
return, the manager will receive access to a range of resources including research, technology,
operational infrastructure and support, as well as an audited track record.

Key Terms

● Capital Allocation: An initial allocation of $1M to $5M, increased over time based on performance
versus agreed upon benchmarks
● Duration: Minimum of three years
● Basic Compensation: Guaranteed minimum compensation of $80,000 per year, plus benefits
● Annual Trading Profit Split:
○ 70% – Social Capital
○ 30% – Paid out to manager
● Hurdle Rate: 0% hurdle on capital allocations below $30M, scaling to 10% by $50M
● Capital Introduction: Social Capital may seed, and provide capital introduction for, managers
departing the program to raise external funds, at terms to be discussed
● GP: Social Capital retains a 25% GP stake, which can be bought out after seven years

Collaboration & Community

Managers are expected to help one another, utilize provided resources for self-improvement, and
participate in a collaborative, knowledge-sharing culture. Sharing ideas, experience, and expertise across
strategies will be core to our collective success and empower managers to creatively seek out new
markets and new investment opportunities. Ongoing, regular discussion of existing and prospective
investments, as well as idea dinners, teach-ins, and office hours will be key in this effort.

Risk Management

Managers are expected to be entrepreneurial and opportunistic. Our risk management philosophy is
designed to encourage and enable a long-term approach without top-down micromanagement or complex
portfolio construction parameters:
● Positions greater than 5% of equity require a written one-page thesis shared to the group
● Positions cannot exceed 15% of equity at time of entry
● A total portfolio drawdown of 30% or greater will trigger a manager review, which may include
remedies up to and including termination, though not in all cases

This term sheet is being provided in connection with certain proprietary investment activities Social Capital intends to
pursue. This term sheet does not relate to any investment products or services offered by Social Capital to others,
and it does not relate to any offer to sell any securities. This term sheet is for discussion purposes only and no
obligation on the part of any party will arise (if at all) until definitive agreements are signed by all parties.