"Investing in pre-IPO companies is no easy feat unless you’re a sophisticated investor, but Open Investing [now Access Investing] wants to change that.
A key advantage of obtaining sophisticated investor status is that you can invest in companies looking to raise pre-IPO funding before they issue a detailed prospectus.
Any offer of securities to retail investors, regardless of the stage the company is at, requires a full disclosure document — the prospectus.
But with no such requirement for sophisticated investors, “sophies” are typically the only ones to get access to those investments at that early stage.
And as Open Investing [now Access Investing] managing director Brett Tucker notes, it’s those same investors that share the spoils time and again. Tucker spent the last several years at corporate advisory firm Ventnor Capital. He’s also served as company secretary to several ASX listed companies, and has overseen a number of capital raisings.
“We see the same names pop up time and time again, the same high net worth investors, and seeing brokers take significantly discounted offers and give them a good return for a small amount of time held. Sometimes it’s three months or less until they come to market,” he told Stockhead.
“And we’re looking at ways to get those investments into the hands of retail investors. But we’re also mindful of the Corporations Act requirements and protections around that process.”"
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