Chapter Twenty-one: Pre-IPO Investments – Maximizing Technology Opportunities
Smart investors have long ago realized that buying shares in startups early in their development can deliver exceptional returns if you choose the right vehicle. Here at Turnkey Family Office, we are continually assessing new businesses and markets to identify those early opportunities, which usually means buying into the initial public offering (IPO) stage.
But what if you could get involved even earlier? That is the premise of the Pre-IPO investment, getting in earlier to secure more value from each dollar investment, while increasing the potential rewards. By getting into an investment so much earlier, it is often also possible to realize those profits sooner, reducing overall risk exposure as a result.
The challenge is both identifying and accessing these opportunities, but it is possible.
For most companies who sell pre-IPO stock, they use a specific process known as Pre-IPO Placement. This process is aimed primarily at institutional investors such as private equity firms, hedge funds and so on, and allows the company to raise funds without the vagaries of market volatility that they are tied to once the company goes public through an IPO.
The opportunity itself is clear. Earlier investment secures a larger share per dollar, and it give investors the chance to realize greater profits from the growth a successful IPO usually brings. However, for a Pre-IPO things are not straightforward. As mentioned, these opportunities normally fall to institutional investment organizations, and the barrier for entry is much higher than would be the case for an IPO too.
In addition, many countries require individuals to meet specific criteria including net worth and income level. Only those meeting set targets are able to participate. A Pre-IPO sale also often comes with a lock-in period, preventing the sale or trade of any purchased shares for a stated time period. This is done to prevent pre-IPO investors dumping stock immediately after the IPO and affecting market prices.
Seizing the Opportunity
Of course, as a professional team with a vast network of industry partners, Turnkey Family Office are able to identify and negotiate Pre-IPO Investment opportunities for you. While in some jurisdictions you will still need to meet legislated criteria for accreditation to invest in these opportunities, we do provide an avenue for our clients to access these investment opportunities that would otherwise be out of reach.
As a way to build long-term wealth this kind of investment has few peers. Imagine getting in on Uber at half the IPO share price? That is what is possible, the key is identifying the right opportunity. As with any investment there are risks, not every company soars after its IPO for instance, and some never make it as far as the IPO at all. But with guidance from Turnkey Family Office, where we carry out extensive research and analysis on any potential investment, getting involved with a Pre-IPO opportunity with a great business can be a key to exponential growth.
Finding new ways to maximize returns is crucial for any investment strategy over the long term, and by finding Pre-IPO opportunities to invest in, that is exactly what is on offer. Discounted shares and larger profits maximize your ROI, delivering impressive outcomes for your portfolio.
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