As start-ups delay their initial public offerings, TSG Invest’s new guide reveals how accredited investors can seize this extended pre-public window. The resource explains the structures, risks, and regulatory changes behind the rise of pre-IPO investing.
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TSG Invest Publishes Guide to Pre-IPO Investing for Accredited Investors
Photo by Benzinga
Key Takeaways:
- TSG Invest has released a free educational resource for accredited investors
- The new guide explains pre-IPO investing, including structures and risks
- Companies now take around 13 years to go public, compared to 10 in 2018
- The JOBS Act of 2012 boosted private shareholder thresholds
- Understanding the private secondary market is vital for successful pre-IPO deals
Pre-IPO Investing on the Rise
TSG Invest, a multi-entity financial services firm, has published a free educational resource titled “Pre-IPO Investing: The Ultimate Guide.” In it, the firm outlines how accredited investors can buy shares in companies that remain private for longer than ever before.
Why Companies Are Staying Private Longer
According to TSG Invest, businesses now wait, on average, about 13 years before launching an initial public offering. That’s a notable jump from a median of 10 years in 2018. As a result, the highest-growth period for these companies often unfolds away from public markets, prompting greater interest in private share purchases.
Regulatory Changes and the JOBS Act
The guide also accounts for key regulatory shifts. It cites the JOBS Act of 2012, which raised the shareholder threshold that compels a private company to begin the public filing process. This change has encouraged companies to stay private for longer periods, allowing them to scale without meeting the regulatory demands of a publicly traded entity.
Understanding the Private Secondary Market
Beyond timing, TSG Invest’s guide explains how early investors can transfer private shares through the secondary market. This allows accredited investors to tap into promising start-ups while learning about potential risks, such as limited liquidity. The firm’s resource lays out these considerations in detail, aiming to provide clarity in a space often seen as opaque.
What the Guide Offers
For those intrigued by opportunities in private financing, “Pre-IPO Investing: The Ultimate Guide” distills critical information into a concise format. It highlights the essentials of selecting partners who can provide dependable research and guidance on pre-IPO shares. By acknowledging the growing significance of pre-public markets and the influence of regulatory reforms, TSG Invest’s guide delivers a roadmap for accredited investors looking to explore new horizons in early-stage investing.
