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The secondary market: Startup shares trade on Companisto

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Companisto offers a flexible approach for investors: Startup shares can be traded on the Companisto secondary market

5 minute read

 

Companisto introduced a secondary market for startup shares in May 2022, which has since enjoyed great popularity among investors. The Companisto secondary market offers private individuals the opportunity to sell their shares purchased on Companisto to other investors or to buy new shares.

The secondary market was created at the request of Companisto investors, who are called Companists. They frequently asked for a platform on which shares could be sold and new shares bought - independently of a financing round. Companisto has responded to this request and built a platform on which opportunities for action are offered. A general explanation and definition of the secondary market can be found here.

 

The secondary market offers a number of useful advantages


Companists benefit from the secondary market in many ways: investors can sell their shares at any time. This gives them more flexibility if their life situation changes or they want to restructure their portfolio. Another added value of the secondary market is the possibility of portfolio diversification. By trading startup shares, independent of an ongoing financing round, investors can invest in a broad range of companies, diversifying their own portfolio in many ways and thus reducing their individual investment risk. Furthermore, the purchase price of shares is agreed between the buyer and the seller, which means that the minimum investment volume of 250 euros does not necessarily have to be adhered to and more favorable shares can also be purchased. In addition, the change in value of the respective startups on the platform makes it possible to purchase shares below 250 euros - in the usual financing rounds, investments can only be made from 250 euros. 

 

The secondary market provides a central place to make investments available to everyone registered with Companisto. This is more convenient and efficient than individual independent voting. Due to the chat function, it is not necessary to give out personal information such as the email address or phone number. Investors can make a profit if shares in particularly attractive startups are sold at a higher value than was originally paid. The prerequisite for this is that the buyer and seller come to an agreement. In addition, existing investments can be increased and one's own portfolio can be reshaped. Equity investments are also usually a long-term investment that only ends when a company exits. Through the secondary market, shares can be sold before a company makes an exit, allowing investors to sell their shares early. By being able to purchase investments from missed funding rounds, Companists can invest in startups that have already had some development on Companisto. 

 

How does the Companisto secondary market work?


Companisto provides the platform for trading, but is not actively involved in the process, which means that the company's own secondary market is not regulated. Only persons who are verified on Companisto according to the regulations of the Money Laundering Act and whose mobile phone number is additionally verified have access to the platform. This provides a high level of security for all buyers and sellers.

 

The selling price is also set individually by the seller and additionally negotiated with the buyer through a chat function. The seller and buyer must come to an agreement and then pass on the agreement reached, without the exact sales price, to Companisto. The entire sales process is also anonymous: buyer and seller do not receive detailed contact information from each other, but can only exchange information in a chat, in which the first and last name of the potential buyer and seller are displayed. In addition, some protective measures are taken on the secondary market: Trading is suspended in case of follow-on financing of startups, exits or uncertain economic situations of companies.

Different forms of investment on the secondary market   

The way the secondary market works at Companisto depends on the investment form. Individual instructions with explanations for the respective forms of participation can be found here. The platform is also open for the following forms of investment:

GmbH shares
Shares
Profit participation certificates
Participatory subordinated loans
sub-participations

These are the requirements for using the platform
Only verified persons have access to the Companisto secondary market. This serves the security of sellers and buyers. In addition, according to legal regulations, a written confirmation from the buyer and seller is required for the transfer of shares. There is also no guarantee that a share will actually be sold, and it is important to be aware of the risks of startup investments.

The Companisto secondary market as an opportunity for investors

With the secondary market, Companisto has created a platform that offers investors more flexibility and a variety of opportunities. On the secondary market, registered persons can trade shares on Companisto even if no new round of financing is taking place.Adjusting the portfolio is particularly advisable if an investor's personal circumstances change or he wants to restructure his portfolio. In addition, investors can also buy shares in startups on the secondary market in which they did not participate in a financing round. This can help diversify the portfolio and reduce risk. The secondary market allows people who share a passion for startup investing to network, additionally creating a space for sharing. In summary, the secondary market offers investors a new innovative way to invest in startups and benefit from their success.

 

Status as of 28.09.2023 14:28


 


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The acquisition of the offered securities and investments is associated with considerable risks and can lead to the complete loss of the invested assets. The expected yield is not guaranteed and may be lower. Whether it is a security or an asset investment can be seen in the description of the investment opportunity.
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