Secondary Market Trading Arena
Meet PrivatEquity.biz pioneering Israeli Secondary Market Trading Arena
We would like to bring to your attention an innovate model in the Israeli capital market. PrivateEquity.biz is an online Secondary market platform that enables various equity solutions to companies and shareholders. The new model offers companies an employee retention and empowerment tool.
PrivatEquity’s Employee Value Generator Program for Growth Companies
It is customary to reward employees in the high-tech industry by offering options to purchase shares of the company in which they work. However, most of the employees do not get to benefit from their granted options, and rarely get to exercise their holdings as long as the company is private.
The solution: Employee Value Generator Program
Privatequity’s Employee Value Generator program allows a firm to accompany its employees in the realization of their options prior to IPO or a significant sale. The company controls all the aspects of the sell: the percentage of vested options each employee is entitled to sell, the selling price, the investor’s identity and the validity date of the offer.
Here is an interesting case study - Tango.me, has completed a secondary offering of $8 million that allowed employees who hold common stock or stock options to sell a percentage of their shares and vested options during an agreed timeframe.
Advantages for both Companies and Employees
The company decides on the time schedule for the sale, the amount of securities to be sold, the price at which the securities will be offered and the identity of the investors who purchase the shares
The company does not bear the costs of employee options compensation and recruits investors who share the company’s vision and have the financial stability to maintain the shares over time
The company allows its employees to exercise a portion of their options, lightens their financial concerns and motivates them
The company creates value for employees and gains value of its own, by establishing a company market price and by cooperating with new investors that will help in promoting the company’s goals
The company demonstrates to the marketplace the scope of compensation it offers its employees and increases its appeal and its ability to recruit the finest employees available in the market
The entrepreneurs and investors in the company’s early investment rounds benefit from the increase in value of their investment, without having to sell any part of the investment
Integrating Companies into the Model
PrivatEquity allows the program members to take advantage of the secondary market and offers creative solutions for managing the company’s capital while taking advantage of the existing capital and creating value for the company, employees and investors.