Almost two million investors in private companies don’t know the value of their shares, a survey by a peer-to-peer trading platform shows.
Research by Asset Match found that 27 per cent of private investors (1.8 million) struggled to ascertain the worth of their holdings, while more than a million shareholders (16 per cent) said they could not invest in other private companies because they couldn’t sell their existing shares. Among the 18-34 demographic 24 per cent cited this as an issue.
Stuart Lucas, Co-CEO of Asset Match, is calling for greater transparency and communication from private businesses.
He says: “Demand among investors to buy shares in Britain’s exciting high-growth businesses is rising all the time, particularly as alternative finance, angel investment and crowdfunding become more prominent. However, this research uncovers a concerning problem being experienced by those who have already invested in these companies – namely, shareholders are too often ignored and pushed to one side.”
Among the respondents, 10 per cent of UK shareholders said they had never been given the opportunity to discuss their investment while 11 per cent said they have held shares for longer than they intended to.
Lucas adds: “There are huge numbers of shareholders in the UK who want to sell their shares but cannot, don’t know how much their shares are actually worth, or wish to invest in other companies but are trapped in their current investments. Failure to address this issue will not only breed further discontent within Britain’s shareholder community, but also risks stunting the long-term growth of the private sector by not enabling investors to sell shares and re-invest in the next generation of scaling companies.”