Retail investment platform sees a Covid-19 operation spike, the UK's Primary Bid raises $50 million

In recent years , the advent (and increasing popularity) of start-ups developing platforms that help more people take a more proactive position in the world of financial services has been one of the biggest developments in the world of fintech. Today, in the aftermath of the Covid-19 pandemic, one of the more ambitious hopefuls of developing an investment service in the UK is announcing a major growth round after seeing a burst of interest this year.

PrimaryBid, which offers institutional investors (i.e. ordinary and non-professional investors) the right to invest in new public company-issued shares, has raised $50 million in its own new funding. The financing comes on the heels of the start-up partnering with larger investment banks to get institutional investors into 41 capital raising campaigns since April 2020 for UK publicly listed businesses and trusts.

Anand Sambasivan, CEO of PrimaryBid, said in a statement, "The COVID-19 pandemic showed the efficacy of the public markets, with companies rapidly and efficiently recapitalizing." Our technology has allowed thousands of retail investors to engage with institutional investors on an equal footing, unlocking corporate issuers with a broad and significant source of liquidity and long-term share ownership. The response to our approach from boards and their advisors has been excellent: they understand that our digital retail inclusion approach brings together good governance and best execution.

PrimaryBid aims to use the funds to attract more talent, invest in its technology infrastructure, develop more alliances and grow globally.

This Series B comes from a list of big-name strategic players and VCs, unlike the investors on its website. These include Draper Esprit, OMERS Ventures, Fidelity International Strategic Ventures and ABN AMRO Ventures, the London Stock Exchange Group, as well as previous Pentech and Outward Ventures supporters.

The LSE Group could provide an indicator of which geographies could be potential targets for PrimaryBid: the Borsa Italiana exchange in Italy is also part of the group 's footprint, as is the Turquoise pan-European stock market.

"This investment builds on our relationship with PrimaryBid and is part of the commitment of the London Stock Exchange Group to increase access to public equity markets for institutional investors," said Charlie Walker, Head of Equity and Fixed Income, Primary Markets, London Stock Exchange plc, in a statement. "Retail investors were able to access capital raises on the same terms as institutional investors through PrimaryBid 's creative offering, benefiting U.K. public companies by providing additional capital and liquidity. PrimaryBid has been an integral part of the capital raising ecosystem of the U.K. and we look forward to working with them to further expand access to capital markets for institutional investors within the U.K. And global.

With this round, which follows a $8.6 million Series A in September 2019, the start-up does not reveal its valuation. Since this summer, this most recent Series B has been the subject of rumours (and most recently a claim last night that the round had finally closed),

The growth of PrimaryBid comes at a time when a number of startups have been developing investment services for those who are underserved, targeting niche opportunities and services. Last month's rally showed that there is certainly capital and potential to invest in (not buy) collectibles; Yieldstreet has developed a forum to introduce investors to new investment groups such as shipping; and companies such as Stash, Revolut and Robinhood also offer a new class of customers to trade and invest.

That doesn't mean that new entrants with an emphasis on smaller investors and investment sector niche opportunities are without their own challenges. Revolut has faced conflicts over the actions of executives (however, these seem to have been resolved: hundreds of millions of dollars are still being raised). YieldStreet has recently sued (and won) a lawsuit against a ship recycling firm, but at the same time, some of its operations seem to be under investigation. And after placing their expansion plans on hold earlier this year, Robinhood indefinitely postponed its plans to launch in the UK.

The recent growth of PrimaryBid has come on the back of a choppy year in the public markets and the investment world.

Much as other facets of our lives were affected by Covid-19, the early months of the pandemic saw a massive freeze descend on the trading world. The IPO market all but dried up and trading slowed down, with many unaware of how future months could turn out in terms of local and global economics.

Then, things started to thaw, with operation steadily and efficiently picking up under new terms: all is remote for now. And what's more, for new teams, the new playing field means a new chance.

This was where PrimaryBid came in. The start-up has developed a platform that makes it easier for institutional investors to engage in new share issues, and it has been around since 2016, but at a time when businesses raising money might be trying to cast their networks a bit wider than normal, it has found its groove.

That doesn't mean that new entrants with an emphasis on smaller investors and investment sector niche opportunities are without their own challenges. Revolut has faced conflicts over the actions of executives (however, these seem to have been resolved: hundreds of millions of dollars are still being raised). YieldStreet has recently sued (and won) a lawsuit against a ship recycling firm, but at the same time, some of its operations seem to be under investigation. And after placing their expansion plans on hold earlier this year, Robinhood indefinitely postponed its plans to launch in the UK.
The recent growth of PrimaryBid has come on the back of a choppy year in the public markets and the investment world.
Much as other facets of our lives were affected by Covid-19, the early months of the pandemic saw a massive freeze descend on the trading world. The IPO market all but dried up and trading slowed down, with many unaware of how future months could turn out in terms of local and global economics.
Then, things started to thaw, with operation steadily and efficiently picking up under new terms: all is remote for now. And what's more, for new teams, the new playing field means a new chance.

This was where PrimaryBid came in. The start-up has developed a platform that makes it easier for institutional investors to engage in new share issues, and it has been around since 2016, but at a time when businesses raising money might be trying to cast their networks a bit wider than normal, it has found its groove.

In April, the company launched a major campaign to highlight the part that institutional investors can play in helping to get the stock market back to its active stage. And the Compass Group, Ocado, Taylor Wimpey and Segro were the companies that have had access to their new share issuance since the beginning of the pandemic.

Retail investors are a long-tail play, in essence. While they would spend far less individually than high net worth individuals or institutional investors, they account for a large amount of activity collectively. According to PrimaryBid, the latest figures from the UK National Statistics Office, from 2018, suggest that retail investors account for some 13.5 percent of UK share capital, but within the FTSE 250, which is closer to 20 percent and can be as high as 30 percent or more in some Target firms.

There are a range of other outlets for ordinary individuals to purchase and exchange shares, but what differs from PrimaryBid is its emphasis on issuing new shares, not selling or exchanging existing shares. In principle, a business may also assign shares to be sold for IPOs through PrimaryBid, but, as defined by a spokesperson, "The real innovation is to include retail in 'accelerated' follow-on increases (which are about five times the size of IPOs in terms of equity issuance) and which have never been available to retail (whereas some IPOs have historically)."

It's a forum for investors and strategic partners that has resonated.

Draper Espirit partner Vinoth Jayakumar said: "Our investment in PrimaryBid aligns with part of our larger investment thesis to democratise access to public markets for institutional investors as well as to modernise software for market infrastructure." For us, the course of travel for the future of finance is expected by both our businesses.

OMERS Ventures, the investment arm of Canada's prolific pension fund, said it is part of the Fintech focus group. "The growth of PrimaryBid in 2020 and its performance in championing retail investors in the capital markets as fintech specialists have been difficult to overlook," said Tara Reeves, partner at OMERS Ventures, in a statement. The technology of PrimaryBid is at the intersection of powerful financial services trends-regulation, digitalisation and democratisation-and OMERS Ventures is pleased to support the mission of the team to place individual investors on an equal footing with institutions. At the highest levels of the U.K.'s capital raising ecosystem, PrimaryBid is now well integrated and we look forward to helping the team achieve their goals globally.

Michael Sim, Vice President, Fidelity International Strategic Initiatives, said in a statement, "We are delighted to be working with PrimaryBid to improve fairness, inclusivity, and openness in capital markets." Anand and the team have developed a unique technology platform that redefines how issuers access capital markets; connects regular retail investors to public companies seamlessly. As the economy rolls out of the coronavirus effect, it is imperative that retail investors get a seat at the table as businesses recapitalize and the economic recovery process starts.