Invest Securities has launched PRE-IPO, the first European crowdfunding platform for private investments in the last financing rounds of unlisted growth companies a few months before they go public.
A website describing the concept will be live between 20 November and 20 December, and will introduce PRE-IPO's first exclusive investment projects in cleantech, biotech, IT and e-Business companies. The full version of the PRE-IPO platform will then officially open on 26 January, 2016.
From an investor's perspective, PRE-IPO is intended for individuals, business angels, family offices and investment funds that seek to invest at a lower price than the future IPO share price by seizing the opportunity to take part in the last financing round of unlisted companies eligible for IPOs. The minimum investment amount is 2,500 euros. Most projects will be eligible for the PEA and PEA-SME, or investors will be entitled to tax benefits on wealth tax or income tax.
Investments made through the PRE-IPO platform are carried out in a secure environment: the platform was created by Invest Securities, an investment service provider regulated since 2001 by the French Prudential Supervisory Authority (Autorité de contrôle prudentiel et de résolution – ACPR) under the umbrella of the Banque de France.
"Whilst, up until now, only investment banks and their customers had access to investments in companies before their initial public offering, PRE-IPO makes them available to everyone. Investors will receive exclusive offers to participate in the last financing rounds of privately-owned companies about to make an IPO. We only select companies that we have previously flagged as eligible for an IPO in the short term. These companies, which are carefully selected based on their business model, tangible and intangible assets, and the quality of their management team, are at an advanced development stage, so investing in them is less risky. Pre-IPO investments achieve a safer, higher and quicker return on investment, hopes of gains being boosted by the 'discount' on the future IPO share price. It's the best private equity has to offer!" says Jean-Emmanuel Vernay (pictured), CEO of Invest Securities.
From an issuer's standpoint, PRE-IPO is aimed at European companies with a plan to go public within the next 18 months and seeking to raise capital one last time before its IPO. The PRE-IPO platform will participate in this last financing round in the amount of up to 5 million euros, on its own or with professional investors.
"The European private equity market is currently in short supply of late-stage and cross-over funding capable of driving investments right before a company's IPO. PRE-IPO contributes to bridge this gap for the benefit of European businesses, venture capital funds and private equity funds," adds Vernay.
As for finance professionals, PRE-IPO will work primarily with the Invest Securities Group, but not exclusively. The platform plans to attract other investment banks, listing sponsors and venture capital funds in Europe, all of which will be able to publicise their most promising pre-IPO projects. The platform will work with them exactly like a co-investment fund would, including through the selection, negotiation, due diligence and preparation of the financing round.
The success of these pre-IPO operations ultimately relies on the experience and skills of trading and corporate finance professionals: Invest Securities is a long-standing key player in the financing industry and the leader in SME IPOs in Europe, with a hundred IPOs completed in the past ten years.
