Why pre-IPO investing?

The private market presents a chance to invest in private companies powering tomorrow’s innovations and the potential of outsized returns. With accreditation, individual investors can access Forge's centralized network of employee shareholders, institutional investors, private company stock and a Private Market Specialist who can help execute transactions.

Who can buy pre-IPO stocks?

Accreditation is the first step in accessing the pre-IPO companies found on Forge. Once qualified, you can tap into valuable insights and opportunities to buy pre-IPO shares.

Possess earned income over $200,000 (or $300,000 with a spouse or partner) for the past two years.

Reasonably expect to maintain the same income in the current year.

Or, possess a net worth of at least $1 million, excluding their primary residence.

Or, hold in good standing a FINRA Series 7, 65 or 82 license.

How to buy pre-IPO shares?

  • After accreditation confirmation, you can view specific investment opportunities
  • Browse and research private companies
  • Indicate your interest to buy specific private company stock
  • A Forge Private Market Specialist is available to answer any questions
  • Forge helps guide you through every step of the transaction process

FAQ

Learn more about the private market on Forge. Explore the FAQs.

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Who can buy private market stock?

Private market investors include many parties, such as individual investors, venture capital funds, mutual funds, and more. To participate as a buyer in the U.S., the investor must be deemed an “accredited investor”, as defined by federal securities laws.

Qualifying as an accredited investor depends on meeting certain financial or professional thresholds, such as having income over $200,000 ($300,000 with spouse or partner) for the past two years, with a reasonable expectation to have the same in the current year.

Or, an individual can qualify as an accredited investor if they (alone or with a spouse/partner) have a net worth of at least $1 million, not counting their primary residence.

There are additional ways to qualify as an accredited investor. The above are just a couple of common examples.

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How do I buy shares in a private company?

While there is no legal requirement to use a broker to invest in private companies, many investors, especially individuals, may find that it’s easier to buy private company shares through a private marketplace like Forge Markets.

Doing so provides advantages, such as offering a centralized network of shareholder/sellers, compared with trying to source a seller with shares in your desired company on your own. Buyers can also benefit from Forge Markets’ experience with private company transfer processes, knowledge of applicable securities laws and transaction documents, and the ability to bring these elements together in a transaction.

On the other hand, one disadvantage of using a broker to buy private company shares is cost. Forge Markets, like most other brokers, charges a fee for their services. Working without a broker would save on these fees.

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What is pre-IPO investing?

Pre-IPO investing refers to investing in a company before it goes public and sells its shares on a public stock exchange. Pre-IPO investing can provide new opportunities for investors who believe that a company is poised for growth and has the potential to generate significant returns. However, it can be a high-risk investment, as there is typically less information available about the company's financial performance and future prospects than there would be for a publicly traded company.

Investors who participate in pre-IPO investing often do so through private placements or secondary market platforms like Forge Markets that allow them to purchase shares in the company before it goes public. For more on pre-IPO investing, please refer to our blog – “What is Pre-IPO Investing?

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How do I value private company shares?

Valuing private company shares can be both an art and a science. Private companies generally don’t provide as much transparency to investors as public companies do, and you can’t see pricing from prior trades as easily as you can look at public company trade data.

That said, you can try to come up with a valuation based on information such as private market trading activity on a secondary marketplace like Forge, recent funding valuations, and valuation histories at comparable companies.

Forge has proprietary valuation insights, and your Forge Private Market Specialist can help you bring together all available information for your valuation assessments.

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What are the fees associated with buying private company shares through Forge Markets?

Working with a broker like Forge Markets, you can expect to pay a 5% fee. Fees might be higher for transactions below our typical minimum of $100,000. Your Forge Private Market Specialist can discuss transaction sizes and fees in more detail with you.

Find your next potential opportunity

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* “Trending Companies” listed above are not a recommendation, offer, solicitation of an offer, or advice to buy or sell securities by Forge Global, Inc. or any of its affiliates or subsidiaries, and are not based on any user’s particular financial situation or needs. Trending Companies are companies on the Forge Markets platform with the highest indications of interest during the time period noted next to the list.