How to Buy Shares of Companies Even Before IPO; Check Details

From company employees

In the early stages of business growth, most private companies offer Stock Ownership Plans (ESOPs) to retain employees and create a feeling of being a part of the company. Unlisted shares can be purchased from such employees.

From the promoters of the company

Promoters have a major stake in every company. You can buy unlisted shares from them through private placement. Through private placement, promoters can sell their shares to specific people or a select group. Such investors cater to the specific needs of the promoters.

Through financial institutions

Financial institutions generally manage investments in unlisted stocks. They invest in a large number of unlisted stocks, as the price is low. Investors looking to get strong returns by taking more risk can buy unlisted shares from such institutions.

From crowdfunding platform

Most startups raise capital through crowdfunding. In this, a large group of investors together buy unlisted shares. With this, a large amount of capital is arranged at once. This is the reason why crowdfunding is very popular among startups.

High investment cost and risk in unlisted stocks

It is important to check the valuation of the company before investing in unlisted shares. The risk is high, so this investment is not for investors with low risk profile. Invest in unlisted stocks only if you have huge capital, which you want to invest in risky assets and earn huge profits in the long run. Also keep in mind that the IPO of the company you are investing in may not come. High commissions are associated with such transactions and the company may even disappear.