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Post by newlender on Oct 9, 2020 7:43:16 GMT
As I mentioned recently I managed to buy one of my favourite companies at the base price at 11.05 on Tuesday. Since then all the shares quoted at that price have been snapped up and now they are beginning to be bought at a premium. I just wonder what you think about this - is any unquoted equity really worth buying at a 30% premium? By the way, I'm not talking peanuts here - one of the base-price purchases was for >£2k.
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Post by wiseclerk on Oct 13, 2020 9:27:31 GMT
As the discounts and premiums depend on the 'fair price' which is usually determined on the last round valuation, the resulting price can be rather outdated. Even with the delayed publicly available information (e.g. Companies House) there can be cases where it is quite obvious that their is a high chance that the company will be valued a multiple higher in the next round. Of course there is no guarantee but if you believe the company will be valued 3x-5x the old valuation, +30% on the old valuation price is neglectable.
An example for that would be Revolut BEFORE the last round (only then trading at Seedrs was only at par. But if ther would have been premiums, they would have deterred noone from buying. Lots were sold out within a minute of the market opening).
Just remember that probably 80-90% of the listed startups will fail.
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Post by newlender on Oct 14, 2020 9:45:06 GMT
Very early on I decided that I would only have 10 companies and I have just 5% of my total portfolio in Seedrs. I have had some duds - Dateplay, for example - but a couple have shot up('fair price' calculation, of course). If I managed to sell those on the secondary market I would be just about in overall credit. One of them sold a lot of shares at a 30% premium last week, so I'm quite optimistic. With these 'unifoals' it's so tempting to put them on the market and take a profit, but I've never sold anything yet and see Seedrs as a bit of a hobby which I can cash in by 2025 or even later.
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Post by wiseclerk on Oct 14, 2020 10:28:01 GMT
I only have a very small percentage of my Assetz in Seedrs too, but unlike you it is spread out over about a 100 companies. See chart here
Based on fair value IRR (yield per annum) is 25%. This is since I started at Seedrs in 2014.
I have sold quite a bit (Revolut, Landbay, ...) so it is not all just paper gains. It would be even better if I were to live in the UK because then I would have EIS/SEIS tax gains on top. I think these tax breaks are actually what makes Seedrs (&Crowdcube) so pupular for the UK investors. he non-UK investors have to think about their strategy much more carefully as there are no windfall profits for them.
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