Investments in private placements holding pre-IPO companies are speculative, illiquid, and carry a high degree of risk, including loss of principal. Investments made on the EquityZen platform are made through pooled investment vehicles, which acquire shares of private technology companies, and are not direct investments in these companies.
“EquityZen believes it has found an alternative that avoids those hassles by allowing employees to sell the rights to the cash their shares will fetch when their company goes public or is acquired.”
“[Secondary markets] allow for different classes of companies that can encourage trading of their shares if it suits their business needs and objectives.”
“This isn’t another one of those crowdfunding platforms that have been emerging over the market recently. Instead this is a quick way for investors to invest into startups.”
“It gives those equity-holders an opportunity to diversify their own portfolio or cash out some shares while they wait for an exit.”