Launching a wholesale fund in Australia is less complicated than most first-time managers fear. But the order matters. Get the sequence right and it's a well-trodden path. Get it wrong, and you can spend money establishing a vehicle you then have to unwind. You could also discover late that you needed a licence you don't have.
Setting up a wholesale fund runs roughly like this. First, confirm every investor will be a wholesale client. Then choose the vehicle (a wholesale unit trust is the most common), and establish it with a trust deed and an information memorandum. Next, appoint a licensed trustee and issuer, and decide your licensing route: your own AFSL, or operating under an existing one. Finally, stand up administration and AML onboarding, then offer interests and raise. Most wholesale schemes are unregistered, because they're offered only to wholesale clients. But here's the trap: being exempt from registration doesn't exempt you from licensing.
Step 1: Confirm your investors are wholesale clients
This is the gate. Everything downstream turns on who invests: whether you register the scheme, what you must disclose, which licence authorisations you need.
If every investor is a wholesale client, you're in a materially lighter regime. If even one retail investor is involved, the position changes entirely. Registration, a Product Disclosure Statement, a Target Market Determination, AFCA membership and retail licence authorisations all come into play.
The wholesale client tests sit in the Corporations Act (principally sections 761G and 708). They include limbs based on the value of the investment, on certified net assets or income, and on being a professional investor. The thresholds and the certification requirements are specific, and getting this wrong is not a paperwork problem. It's a licensing one. Confirm each investor's status, and document it, before you accept a dollar. → The wholesale client test: who actually qualifies?
Step 2: Choose the vehicle
In Australia, the usual options are:
- A wholesale unit trust: the most common vehicle for a wholesale fund.
- An SPV company: a special purpose vehicle incorporated as a company, often used for a single asset or deal.
- A limited partnership: used in some strategies and for some investor bases.
The right choice depends on your strategy, your investor base and the tax outcome you need. It's much cheaper to get right at the start than to change later. Take structuring and tax advice before you commit.
Step 3: Work out whether the scheme must be registered
A pooled fund is generally a managed investment scheme. Whether it must be registered with ASIC turns largely on who invests in it.
ASIC's guidance is that a scheme generally must be registered if it has more than 20 members. It must also be registered if it is promoted by someone in the business of promoting schemes. ASIC also says that schemes in which all interests are issued to wholesale clients are generally exempt from registration (section 601ED of the Corporations Act). See ASIC: How to register a managed investment scheme. Most wholesale funds therefore run as unregistered schemes. That also means no responsible entity is required.
Step 4: Decide your licensing route
Operating a scheme, and issuing interests in it, are financial services. So they need to be covered by an AFS licence (ASIC: Do you need an AFS licence?). It doesn't have to be your licence. There are two routes:
- Hold your own AFSL. Full control of your authorisations, plus the full cost, capital requirement and timeline that comes with it.
- Operate under an existing AFSL. You're appointed as a corporate authorised representative to run the strategy, and the licensee acts as trustee and issuer of the scheme.
This choice drives your budget and your launch date more than anything else on this list. We compare the two in detail in own AFSL vs authorised representative.
Step 5: Appoint the trustee and issuer
Someone licensed has to be the trustee and issuer of the scheme. That means holding legal title to the scheme's assets on behalf of unitholders, issuing the interests, and carrying the trustee and issuer responsibilities.
There's an important structural rule here that surprises people: a corporate authorised representative cannot itself operate a managed investment scheme. Operating the scheme sits with the licensee. So under the authorised representative model, the licensee is trustee, issuer and operator. You run the investment strategy and provide the dealing and advising within your authorised scope. → Managed Scheme & Trustee Infrastructure
Step 6: Establish the fund
The documents that actually bring the fund into existence:
- The trust deed or constitution that constitutes the fund and sets its rules.
- The information memorandum (IM): the offer document used to present the fund to wholesale investors. (An IM, not a PDS: a PDS is a retail disclosure document, and you're not offering to retail.)
Step 7: Stand up the operations
Before you can take a dollar, the plumbing has to work:
- Fund administration: unit registry, applications and redemptions, unit pricing and NAV, distributions and investor reporting.
- Bank accounts for the fund.
- AML/KYC onboarding for every investor.
This is unglamorous and routinely underestimated. It's also the part that determines whether your investors have a good experience or a bad one.
Step 8: Get authorised, then raise
Finally, the authorisation itself. This is where the two routes diverge sharply on time:
- Authorised representative: generally a matter of weeks, because the licence and compliance framework already exist.
- Your own AFSL: the application is assessed by ASIC and generally takes at least eight months (ASIC: RG 1).
Once authorised, you can offer interests to wholesale clients and begin raising.
What it costs, and how long it takes
The short version:
| Under an existing AFSL | Your own AFSL | |
|---|---|---|
| Setup cost | $20,000 to $60,000 | $60,000 to $100,000 |
| Capital required | Held by the licensee | Additional $150,000 in net tangible assets |
| Time to authorisation | Weeks | At least 8 months |
Both figures are indicative and exclude ongoing costs. We break the numbers down in full (including what each excludes) in what does it cost to set up a wholesale fund?
Where an integrated platform fits
Read the eight steps again and notice how many separate counterparties they normally imply. There is a lawyer for the deed, an adviser for the structure, a trustee, an administrator and a compliance consultant. There is also a licence you either apply for or go looking for. Most of the cost, and nearly all of the delay, comes from assembling that yourself.
Provenance collapses it. Providence Equity Holdings acts as trustee, issuer and operator of the scheme and provides the compliance and operational framework. It onboards you as an authorised representative to run the strategy, on a fixed engagement fee, in weeks rather than months.
What stays with you is what should. That means running the investment strategy within your mandate, ensuring every investor is a wholesale client, and providing accurate information for administration and reporting. → Authorised Representative Onboarding
Frequently asked questions
How do you set up a wholesale fund in Australia?
Broadly, the process runs like this. First, confirm every investor will be a wholesale client. Then choose the vehicle (a wholesale unit trust is the most common), and establish it with a trust deed and an information memorandum. Next, appoint a licensed trustee and issuer, and decide your licensing route. Finally, stand up fund administration and AML onboarding, then offer interests and raise. Most wholesale schemes are unregistered because they're offered only to wholesale clients. But being exempt from registration doesn't remove the licensing requirement.
Do I need to register a wholesale fund with ASIC?
Generally no, if interests are issued only to wholesale clients. ASIC's guidance is that a scheme generally must be registered if it has more than 20 members. It must also be registered if it is promoted by someone in the business of promoting schemes. But schemes in which all interests are issued to wholesale clients are generally exempt from registration (s 601ED(2)). No registration also means no responsible entity. If retail investors are involved, the position changes entirely.
Do I need my own AFSL to run a wholesale fund?
You generally need to be covered by an AFS licence. But it doesn't have to be your own. Operating a scheme and issuing interests in it are financial services, so they require a licence even for an unregistered wholesale scheme. You can hold your own AFSL, or operate under an existing one as a corporate authorised representative while the licensee acts as trustee and issuer. A corporate authorised representative cannot itself operate the scheme.
What vehicle should a wholesale fund use?
A wholesale unit trust is the most common vehicle in Australia. An SPV company or a limited partnership can also be used. The right choice depends on the strategy, the investor base and the tax outcome you need. Take structuring and tax advice before you commit. Changing the vehicle later is expensive.
How long does it take to set up a wholesale fund?
The establishment work itself is usually measured in weeks. The licensing route drives the real timeline. Being appointed as an authorised representative under an existing licence is generally a matter of weeks. Applying for your own AFS licence is assessed by ASIC and generally takes at least eight months.
How much does it cost to set up a wholesale fund?
Under an existing AFSL, typically $20,000 to $60,000. Applying for your own AFSL, typically $60,000 to $100,000. On top of that, add an additional $150,000 held in net tangible assets, and at least eight months of ASIC assessment. Both are indicative and exclude ongoing costs. See the full cost breakdown.
Related reading: Independent trustee or integrated licensee? Choosing the trustee structure. Registered vs unregistered schemes and PDS or information memorandum? Two decisions inside the process. What does it cost to set up a wholesale fund? The two routes, with real numbers. And own AFSL vs authorised representative: how to choose your licensing route.
Sources & further reading (ASIC)
This page draws on guidance published by ASIC. For the authoritative position, see:
- Do you need an AFS licence? Dealing in a financial product, which includes issuing interests in a managed investment scheme, is a financial service
- How to register a managed investment scheme: the registration test (s 601ED) and the wholesale-client exemption
- AFS licensing requirement for trustees of unregistered managed investment schemes (INFO 251): under revision in 2026 following ASIC v BPS Financial; confirm the current version
- RG 1 Applying for and varying an AFS licence: what ASIC assesses, and why timelines vary
- Running a registered scheme: the responsible entity obligations you avoid by staying wholesale and unregistered
- The wholesale client tests sit in the Corporations Act, principally sections 761G and 708
ASIC guidance is general and doesn't address your circumstances. Confirm how it applies to you with your own adviser.