Inside the Mind of a Private Investor
In April of this year, the Linqto team took a survey that captured 200 of its notable accredited investors. This article is the result of that survey.
“Traditionally, only 2% of the world’s accredited investors have legal access to the world’s private markets. Linqto utilizes a technology-enabled platform to address this issue by providing a liquid investing environment for the other 98% to also invest in unicorns before they go public.” — Alan Kerlidou, .” — Alan Kerlidou, Customer Relations Specialist, Linqto
While the world of private investing is accessible to many, studies show that only a small portion of the population that is considered eligible as accredited investors have actually obtained access to private markets. This means that the majority (98%) of the world’s potential investors are not reaching unicorns and other important assets before they go public.
Linqto’s goal using our mantra of “private investing made simple” is to democratize the access to private equity investments for equity investors.
Decades of experience pulled together in one platform
Across the last decade of working with private investments and accredited investors, the Linqto platform has gained valuable insight into the interests and hesitations of private investors when accessing what the market has available to them.
Over the past 3–4 years specifically, Linqto has come across thousands of investors — some prospects who did not qualify as accredited investors or decided not to purchase for other reasons, and some customers who have already made one or several purchases on the Linqto platform.
This Spring, the Linqto team conducted annual feedback surveys from some 200 accredited investors and 300 prospect (unaccredited) investors. When collecting responses from this myriad of investors — what surprised the team at Linqto most is that — both the prospects/unaccredited group and the accredited/customer group had the same feelings towards investments overall.
It turns out, no matter what your capital net worth may be, as an investor today, certain laws hold true. And, despite other variances amongst investors (including country of origin, wealth class, industry background, etc.), what investors want to see is fairly consistent.
They choose platforms based on the same criteria.
As a first example, when surveyed, both prospects and customers had similar motives in choosing a platform for private investment.
74.1% said that the main factor that influenced both prospects’ and customers’ decision to join Linqto is its product selection.
14.8% stated that they joined because of the investor community.
Another 11.1% said that the minimum capital requirements, set at just 10K rather than the usual 100K-200K minimum, was what drew them in.
They buy, or would buy, the same companies (in nearly the same order of priority).
Amongst the investments that our customers had already successfully invested in, favored, and chose, it seems that the same three unicorns made the top of their list.
- Robinhood (Investing app)
- Ripple (Blockchain payment network)
- Uphold (Blockchain digital currency exchange)
They invest in the same asset classes overall.
In addition, it seems that the rest of their investments, apart from unicorns, was comprised from the same asset categories:
Nearly all members allocate over 50% of their funds to digital assets (cryptocurrency blockchain).
Next on their balance sheet comes bonds and equities at 23.1% of their total, and that’s followed by “other” real assets, leaving 11.5% in commodities.
They share the same investment profiles.
What’s more interesting though, is that both prospects and customers, when asked to write in what companies they would like to see on Linqto next, cited almost unanimously the same (3) three companies, an interesting predictor as to what categories of investments are trending.
Both groups cited the following as companies they would like to see on the platform:
•PolySign.io (a cybersecurity company)
•ChainLink (a smart contract group)
•SpacEx (a private space program)
It’s worth noting that all three companies fall into the categories of DeFi (Decentralized Finance) or Blockchain and Disruptive Technologies, two possible asset classes our teams predict to exponentially grow in the foreseeable future.
Overall, they want investing to be easier.
As ease-of-use is another factor in the adoption of almost any platform, Linqto asked its Prospects and Customers, “how difficult is Linqto to navigate as a platform?”
96.3% of all members stated that it was easy or moderately easy to start investing on the platform.
Our Customers have stated that the ability to purchase private equities on an app in this form has removed considerable friction — with digital versions of all paperwork and no need to call a broker, hedge-fund manager, or check-in with a firm before making a purchase.
Appealing to Prospects and Customers with new technology.
In addition to its user-friendly platform, Linqto has recently partnered with Uphold to bridge the gap between private investments and crypto, allowing investors to now use their Uphold Wallet to acquire private investments. As far as we know, this is an absolute first in the market. We are excited to see what traction this new wallet addition carries with it.
Linqto hopes the addition of this wallet will allow even greater access to private investments through seamless crypto and forex exchanges, making this the first of its kind.
It seems that when you look at both accredited investors/customers and prospects/unaccredited investors at the same time, you find that there are striking similarities — from their motives to choose a platform, to their current investments, to what excites them for the future.
When it comes to democratizing the availability of assets, it seems that the audience of investors — no matter their worth or background — is surprisingly, already on the same (digital) page.