As an investor, you might be looking for ways to diversify your portfolio, invest with passion and capture higher returns. On the other hand, as an entrepreneur or business owner, you might be searching for ways to take your startup to the next level without personally guaranteeing loans or going through tedious financing applications. This is where Stryde comes into play.
Stryde is the first and only regional private market investing platform. In this guide, we’ll cover everything you need to know about investing on Stryde, including the basics, the advantages, the risks, and the regulations.
Chapter 1 – Unveiling Private Market Investing
You probably have come across Interactive Brokers or Robinhood. These platforms allow individuals to invest and trade shares of publicly traded companies. Private Market investing is the opposite, you get to invest in companies before they are publicly traded and this generally means higher risk higher reward. Stryde's focus is on presenting exciting investment opportunities across Venture Capital and Private Equity. Through Stryde, someone in Dubai will be able to invest in a San Francisco based startup or someone in Riyadh will be able to invest in an English football club and much more…
As an investor in early stage ventures, you have front row seats to the journey of a new venture or a business going to the next level. Just like investing in public companies on stock exchanges, your success relies on the company. You will take part in the venture’s growth, enjoying the rewards alongside like-minded investors.
Historically, early-stage ventures were limited to wealthy individuals and Venture Capital funds. However, Stryde changes the game, allowing different types of investors and individuals to become co-owners of high potential ventures. You can directly support growing companies that are shaping the future, giving you the ability to invest with passion and make a real difference.
Recognising the importance of involving retail investors in private market equity investing, the Dubai Financial Services Authority (DFSA) stepped in. DFSA implemented a robust regulatory framework, ensuring a safe and transparent environment for both investors and ventures and we're happy to be fully regulated by DFSA as an Investment Crowdfunding platform.
Chapter 2 – Advantages of Investing with Stryde
Stryde is changing the traditional investment landscape, making exciting startups, early-stage ventures, sports, and much more accessible to everyone. This type of investment is a win-win, with investors gaining exposure to ventures with high potential, and businesses securing vital capital to propel their growth, or just allowing their users to become shareholders and own a piece. The advantages are limitless, but we’ll spell out a few of them if you’re not convinced:
For Investors:
Access exciting high growth opportunities
Through Stryde, you can choose to back bold and innovative companies looking to shape the world around us or own shares in a football club or even both. You have the ability to invest in a vision you believe in and then reap the rewards when the venture thrives. Imagine owning a piece of the next big thing!
Minimal Upfront Investment
Now you can access private markets with as low as $1,000 which means the days when such opportunities were reserved for the top 0.1% are long gone. You can become an investor in exciting regional and global ventures, without putting a massive dent in your bank account.
Anyone is Eligible
At Stryde, our goal is to democratise investing. If you don’t know what that looks like, imagine having access to early-stage companies at investment amounts you’re comfortable with. Imagine having the ability to explore a variety of companies across different industries and stages, each with their own unique risk profile. Everyone is eligible, all you need to do is complete the onboarding process and be willing to invest. Whether your goal is to begin your journey as an equity investor or diversify your portfolio, Stryde makes it easier than ever to get started.
Portfolio Diversification
Diversification is one of the key components of crafting a smart investment strategy. At Stryde, we offer a range of opportunities across various geographies, industries and stages allowing you to craft a diversified portfolio that matches your risk tolerance. To make a good thing even better, private company valuations often have lower correlation with their public counterparts. This means that, in addition to offering potential for massive returns, private markets can help manage the risk of your public stock portfolio.
Due Diligence
To offer our users high quality investment opportunities, Stryde ensures comprehensive due diligence checks. Our team spends weeks analysing every application with a focus on financials, team, business model, and future potential before deciding to list it on our platform. Our in-house AI-assisted expert vetting process strives to weed out poor applications, leaving you with only what we believe to be high potential investment opportunities.
Higher Potential for Returns
Venture Capital can carry higher risks, but the potential rewards are proportionally expanded. Investing early in promising ventures gives you the opportunity to enjoy significant gains as they begin to scale. That’s apart from the exclusive perks and rewards those ventures often offer early supporters.
For Ventures:
Access to Capital
Traditional business financing options can be challenging, especially for early-stage startups. Stryde bypasses the complex financing requirements, unlocking the capital you need to move your venture forward. By expanding the capital available for companies and democratising funding, your business can secure the capital needed to prosper, forming crucial relationships and fostering innovation along the way. You get to focus on building while fundraising at the same time without sacrificing one or the other.
Build a Loyal Fanbase
Loyalty is crucial particularly for consumer facing brands and early stage ventures. By enabling users to become shareholders, you are creating a community of loyal brand advocates. These early-stage investors help you spread the word, purchase your products, give you indispensable feedback, and become tireless supporters. Imagine forming strategic partners in the form of investors and brand ambassadors. Stryde makes it possible!
Shine a Spotlight on Your Brand
Working with Stryde isn’t only about raising capital. In fact, it’s also used as a powerful marketing tool, appealing to new audiences and generating a buzz around your startup. Stryde puts your brand in the spotlight, attracting new customers and investors at the same time.
Industry Agnostic, Stage Flexible
At Stryde, we believe in inclusivity. We welcome all types of applications with open arms. From budding fintechs and emerging artificial intelligence ventures to sports clubs and entertainment projects, each venture is judged based on its merit, with a variety of capital-raising mechanisms designed to match your needs.
Fairness Matters
Stryde prides itself on a transparent and clear fee structure, eliminating hidden costs and ensuring you are maximising the value of your round. We don’t believe in unreasonable equity demands and implement a standardised valuation process founded on accuracy and fairness.
Chapter 3 – Eligibility for Investment
Investment opportunities through Stryde are open to a diverse range of investors, catering to both retail and professional investors. The annual limit and using credit card are the main differences between the 2 classes of investors with retail investors capped at $50,000 per opportunity and $100,00 per year worth of investments on Stryde while not being allowed to use credit cards to completel their investment. On the other hand, professional investors are free to invest without an annual or campaign specific limit and can use credit cards to complete the transaction
Retail Investors:
A retail investor is any individual who completes the onboarding process and is willing to invest.
Professional Investors:
An individual can be classified as a professional investor if:
The individual has net assets of at least USD 1 million, excluding the value of primary residence. Assets that are indirectly owned can be included in the calculation and:
Within the previous two years, the individual is or has been, an employee in a relevant professional position of an authorized firm or a regulated financial institution OR:
The individual appears, on reasonable grounds, to have sufficient experience and understanding of relevant financial markets, products or transactions and any associated risks.
Chapter 4 – Return on Investment
The question you’ve all been waiting for: how do you make money from private company investments? Besides the benefits of being part of early-stage businesses, there are potential financial gains involved with private market investing.
Before diving into all the ways you can expect to cash in on these investments, it’s important to be aware of all the risks. Crucially, investing in privately held businesses can carry uncertainties, the earlier the stage of the company, the higher the risk (and also the potential reward). Unlisted companies are considered ‘illiquid,’ which means selling shares quickly can be challenging as they’re not available on the stock market. You’ll be able to realise a return on your investment during an ‘exit event,’ which occurs when you sell your shares. Here are the main routes of an investment exit:
IPO
An initial public offering, known as IPO, is an exit opportunity that occurs when a company goes public. This usually happens when a company is facing high demand for it’s stock, with solid financials backing it up. In this case, the company can become a listed company on a stock exchange, such as the DFM, ADX, Tadawul, or Nasdaq.
M&A
M&A, also known as mergers and acquisitions, involves the combination or buy-out of the business. This usually happens when two companies share strategic synergies, or when a larger company or fund decides to outright buy the venture you’ve invested in.
Share Buyback
A share buyback occurs when the company purchases shares back from existing shareholders, likely due to financial success. In this case, you’ll be able to exit your investment early with solid returns.
Dividends
Dividends are profit distributions to shareholders, providing a regular return on investment. Dividends are not a full exit, but they do offer a consistent return on your investment until a full exit can be realised. Dividends are more common for mature companies and not as common among early stage ventures.
Private Secondary Market
DFM or ADX are examples of public secondary markets where existing shares can be traded between buyers and sellers. Private secondary markets allow private company shareholders to sell their shares on a private secondary platform. If all this “private” talk is privately concerning you about your ability to access these private opportunities, don’t worry – here’s your private link to explore Stryde’s opportunities. (Note: private link is not actually private). Secondary markets will soon be available on Stryde.
Chapter 5 – Is Investing in Private Markets Safe?
Investing across Venture Capital and Private Equity particularly early stage startups is risky by nature, which is where the potential for high returns stem from. Investors need to be prepared to lose their investment in the case a venture does not make it.
However, the investment process can be safe when working with a reliable company, like Stryde, who has manuals and procedures in place to maximise protection of your investment. In addition, the space is heavily regulated by Dubai Financial Services Authority (DFSA), which aims to protect investors.
Finally, all investment principles from other disciplines apply, and implementing them will help limit your risk. Invest only what you’re prepared to lose, invest in what you understand, and diversify your portfolio. The last point is particularly important. In the world of startup investing, if only 1 in 5 companies succeeds and grows, that will very likely make up for for the other 4, netting you a tidy profit overall.
Chapter 6 – Making Your First Investment
Stryde empowers everyone to become an angel investor seamlessly and with just a few clicks. Begin your investing journey in exciting high potential opportunities here.
Private markets unlocked with Stryde.
