Wednesday, 10 February 2016
Crowdcube's sophisticated investors
There has been much talk about the sort of investors that the very lax membership requirements on the ECf Crowdcube will encourage.
We came across a recent series of Q and A on the Crowdcube forum which sums up the issue.
Q - How would we get rid of the shares once we have bought them?
A - We aim to float on a small share trading platform or you can sell them via a private company that deals in private shares - our chairman is an experienced investment analyst and has experience in both areas.
Q - How long would that take?
A -We are aiming for 5 years.
We dont know whether this convinced the questioner - we certainly hope not.
What is meant by floating on a small trading platform and what chance has this company of achieving this in 5 years - none.
What companies trade in these private shares? Well for some there is Asset Match - a very new platform that has the likes of Brewdog share auctions once a year but there is no active trade in private shares in the UK. Certainly not for companies at the level this one would be at even in 5 years time.
These responses are total nonsense and we suspect the chairman is as well.
The very fact that this investor is considering parting with cash and is already a Crowdcube member (no doubt listed as an investor in their very helpful factograms) when he has no clue what will happen to his shares is beyond ridicule.