Recently, Yahoo Finance has begun offering data for private companies, which is an exciting development! Previously, it was quite challenging for small investors to access this information. Let’s quickly explore what this means:
What is a private company?
As the word states, a private company is not publicly traded to some exchange like NYSE.
How does Yahoo Finance gets the prices?
When a company is public, the prices are set by the trades that are happening in real time at the exchange they are listed for. For private companies, there is no such information, so they are getting them from specialized data providers, mainly Forge Global and EquityZen. These suppliers aggregate real-time pricing and valuation data from secondary market transactions, funding rounds, and proprietary methodologies, giving Yahoo Finance users access to up-to-date private company valuations that were previously hard.
How can someone invest in private companies?
Yes, you can invest in private companies through platforms like Forge Global, Linqto, and MicroVentures. These marketplaces connect accredited investors with pre-IPO shares or private equity opportunities, making it easier to access and invest in private company stocks.
What is an accredited investor?
An accredited investor is an individual or entity meeting specific financial criteria, such as a net worth over $1 million (excluding primary residence) or annual income above $200,000, allowing access to private investments.
How can you use this data when a company goes public through an IPO?
Private company data is valuable when a firm is preparing for an IPO. Investors can compare the company’s private valuation, growth rates, and funding history to its proposed IPO price. This helps assess whether the IPO is attractively priced and how the company stacks up against public peers. Having access to private data gives investors a head start in understanding the company’s potential as it enters the public market.
Are there historical data so you can backtest previous IPOs?
I could not find any way to get in my hands data for previous IPOs but I do not have an account to the platforms providing this information. I am short a million to be an accredited investor