What is the PrivatEquity.biz Platform?
The PrivatEquity.biz Platform is a tokenized platform in the private secondary market.
It is a bridge between the secondary market investment world and the Blockchain space that allows cryptocurrency holders to diversify their portfolio by getting access to tokens linked to and backed by real assets, such as shares of Pre-IPO Tech companies (Target Companies). At the same time, the PrivatEquity.biz Platform enables private share owners and investors to unlock the value of these assets by creating and selling their asset tokens. The Platform enhances liquidity and transparency of assets, as well as minimizes transaction costs.
The Platform is already active, though not in the tokenized model, offering shares of popular tech companies such as Gett, Palantir Technologies, DocuSign, IronSource and others, all of which were listed by their shareholders, mostly employees, for sale through the Platform. The mentioned companies are all at the pre-IPO stage and meet the qualification criteria of the Platform. Performing a secondary transaction for purchase of shares is subject to reaching an agreed price and subject to further procedures that govern shares of a private company, such as right of first refusal, corporate approvals etc.
PrivatEquity.biz seeks to create a scenario that benefits all participants via the secondary transaction it facilitates; investors gain access to previously inaccessible shares of Target Companies while shareholders in these Target Companies gain access to liquidity prior to an exit or an IPO, especially “small” investors and “small” shareholders who lack the resources and/or ability of putting together a secondary market transaction on their own.
Such liquidity is seen favorably by the Target Companies, as these transactions give proof and validate the benefits to the employees from such options/shares and can be used during negotiation of employee compensation and in retention of human resources.
In addition, such transactions replace long awaiting shareholders with fresh investors that are coming in at a Pre-IPO investment price and are looking to make a profit at the IPO/Exit of the Target Company.
Through our innovative working model we also condense the sale process, from a number of transactions between “small” shareholders and a number of “small” investors into one process. Accordingly, the Target Company’s management and shareholders need to deal with only one transfer process. This significantly cuts down the time, efforts and costs of the purchase process. All this happens without compromising the confidentially of the Target Company’s internal information.
Once we connect our innovative work models with Etherium and using our legal and technical infrastructures, we can issue a new type of assets we call Dedicated Tokenized Equity rights. We achieve this by formally linking traditional contracts with Ethereum smart contracts through mutual reference and code correspondence. Once these tokens are created, anyone who is an accredited investor can invest in shares of leading Pre-IPO Tech companies and verify their holdings through smart contracts on the public ledger.
The result is a secondary market for real world, technologically enhanced equivalents to shares – “equity tokens” – that aim to be as liquid as cryptocurrencies.
We join the best of two worlds: by joining the platform and bringing their fiat currency on-chain, “old school” investors gain access to and join the crypto/blockchain space. At the same time, PrivatEquity.biz also functions as a powerful mechanism for onboarding shares of off-chain companies currently held by private shareholders to the crypto economy and enabling the qualifying members of the cryptocurrency community to invest in asset-backed tokens.
The PrivatEquity.biz platform has received rave reviews, Red Herring, a leading online technology daily, named the platform among the top 100 innovative companies in Europe that offer direct, efficient and convenient processes that link shareholders and investors. The online magazine’s open admiration highlighted the tools that the PrivatEquity.biz platform provides as being able to help investors in the murky investment environment while providing a delicate balance between the privacy of shareholders and their information, and transparency. “This”, the daily tech magazine added, “allows for prudent decision-making when investing.”
In an article published in Globes, Moshit Yaffe, CEO and co-founder of Zirra claimed that “Such a platform is important in a world in which investment decisions in private companies are still too dependent on rumors or skewed information, rather than on objective, data-driven, thoroughly informative analyses. The platform will also allow for accredited investors to invest in better companies which align better with their portfolio, with the help of up-to-date data, insights, and expert opinions.”
The Platform does a lot more than bringing the players in the secondary market together. It also manages the process of share transfers, assists with documentation, administration and the payment process. In addition, the Platform provides backup and support to both parties throughout the entire process of the transaction.
We have chosen to concentrate our efforts on the “small” shareholder, “small” investors and “small” transactions. We chose to do so because we see the social benefit that this strategy can bring with it.
With our Platform, we intend to offer our solution, not only to shareholders, but also to option holders, allowing them to exercise their options and liquidate them quickly and efficiently (the vast majority of which are employees who have worked very hard for these options, and the amazing statistic shows that over 90% of these options are never exercised and expire).
Our strategy supports the democratization of the private equity market, by enabling the small players, mostly employees, to enjoy the financial benefits of their shares, the shares they have worked so hard to get, if and when they choose to do so. With PrivatEquity.biz, they no longer need to wait for management to decide if, when and under what terms they are willing to or interested in performing a buy-back of shares, to publically list the company or having an exit.
As the Platform develops and using our Token Model, the process should become simpler and quicker, creating increasing value for these small shareholders.