Pre-IPO investing exists because companies now stay private much longer. Twenty-five years ago, the average startup went public after about 5 years, so there was little chance to get in before the IPO. Today the average is about 12 and a half years.
Venture capital funds typically have a 7-year time horizon. When a company doesn’t go public for 12 years, those funds have to sell their stakes to other private investors, like us. That created liquidity before the IPO and a whole industry around investing right before companies go public. We like the risk-return balance of this space.
Key points
- Companies took about 5 years to go public 25 years ago. Now it’s about 12.5 years.
- VC funds usually have 7-year horizons and need to exit earlier.
- Their stakes are sold to private buyers, creating the pre-IPO market.
Accredited investors: learn about current opportunities at tickertapeinvestments.com.
