Many investors have been putting their money into well-known startups and unlisted companies. These are through the ways of funding raised by the company. Of course, the companies approach the investors in this setup majority of the time.
Lately, I have come across articles and threads talking about investments in the unlisted shares of the company which are growing at a pace and could give attractive returns.
Unlike the listed ones, shares of unlisted companies are not available for trading on any stock exchanges. So those who want to invest in those companies can do so through other platforms.
There are platforms that help invest in the unlisted markets.
Would like to hear, if anyone can help in giving out more information on how the unlisted market works, and should one really take a bet?
For retail investors ? No, not at all. Its hard to pick from good listed companies, now imagine the information vacuum going around to pick no name, no skin, illiquid companies. Why should retail go around playing complicated games, when good value picks are available on the exchange at all times, especially during corrections and crashes.
If you have a personal relationship with promoter, maybe in that case, it makes sense to invest in the early stages of the company.
Otherwise, unlisted space is usually full of bubble. extremely overvalued and risky.
If you have mastered making money in the listed market, then you may try the unlisted market.
If you cannot make a decent CAGR over a period of time in the listed markets, why even bother in the unlisted scene?
What you see is just the tip of the iceberg. You see startups being highly valued and the investors making money, surely can lure one into such thoughts.
Maybe there are more cases where the company has not picked up and the 2 major risks are practically experienced
Anyway, the risk is too high and the information out there needs to be very carefully scrutinized. I may personally stay away from it.