Retail investor platform PrimaryBid gets backing from SoftBank
SoftBank and Hedosophia, the investment group led by venture capitalist Ian Osborne, led a $190 million fundraising round to support the expansion plans of PrimaryBid, a start-up that enables UK retail investors to purchase shares in initial public offerings and other fundraisings.
PrimaryBid has previously worked with companies such as Deliveroo and PensionBee in the UK, enabling its users to join institutional investors in buying shares on their first sale on the stock exchange.
She also began offering IPO services in the United States, acting for UK clients of Soho House in its New York IPO.
The latest funding round values PrimaryBid at around $700 million, according to a person familiar with the details.
Over the past 18 months, over 150 IPOs and follow-on deals have been listed on PrimaryBid in the UK. It has also expanded in Europe with its first transaction in France.
The company plans to hire new management teams in the US and EU to lead its expansion, as well as use the money to invest in new services and products.
“Our ambition is to democratize the offer on the public market,” said Anand Sambasivan, co-founder of the group. “Our platform deepens the relationships public companies have with their stakeholders and helps them make their equity and debt offerings more inclusive.”
SoftBank’s Vision Fund 2 invests in startups that are expected to explore listings in the coming years. Anthony Doeh, a partner at SoftBank, said PrimaryBid makes it easier for anyone to access equity issues previously restricted to institutional or professional investors.
Hedosophia declined to comment.
PrimaryBid builds the technology and regulatory complements to enable companies to offer shares in an IPO to retail investors, alongside traditional investment banks and brokers.
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Companies are beginning to use their IPOs not only to raise funds, but also to build relationships with their customers by providing them with investment opportunities.
PrimaryBid raised $50 million in October 2020, including from London Stock Exchange Group, Molten Ventures, Fidelity International Strategic Ventures and ABN Amro Ventures. A number of existing investors bought new stakes in the last funding round.
The company has entered into an exclusive agreement with Euronext to act as a partner across the EU to connect capital markets for retail investors. In addition to the UK, it is also regulated in France, from where it can sell services to other EU countries.
Sambasivan said connecting with ABN Amro would also help with expansion in the EU. He added that Amsterdam – which has become the home of the listings of European Special Purpose Acquisition Companies, or Spacs, would be an important market.
The company is also seeking approvals to expand in the United States. Sambasivan said the company is talking with indices and major brokerages about partnering on future IPOs. “If you’re Airbnb, or one of those stakeholder-centric, community-minded companies, why wouldn’t you want to include your stakeholders in a public offering?”
The UK is aiming to reform its stock market rules to allow retail investors to participate more fairly with institutional buyers. The EU is also conducting a consultation on strengthening public ownership.
Sambasivan said PrimaryBid would also like to expand into retail bond services. “What does it take to rejuvenate a retail bond market? UK green gilt, for example, is something I would love to do, and we have the infrastructure to do it.