Third500 in talks with 35-40 US firms on pre-IPO financing leading to a listing

Singapore

BOUTIQUE global investment bank Third500 is in "active dialogue" with some 35 to 40 venture-backed emerging US firms to provide them access to pre-IPO (Initial Public Offering) financing via convertibles, leading up to a listing on the Singapore Exchange (SGX).

Currently, a "handful" of the firms are already embarking on this financing pathway, said Fritz Reichenbach, CEO of Third500, at a media briefing on Thursday, while declining to specify further details. But these efforts take time and are unlikely to produce an IPO on the SGX as soon as this year, he added.

Mr Reichenbach spoke to reporters on the back of the closed-door Fast Tracks Singapore 2019 conference, jointly organised by Third500 and SGX to help the US firms meet potential investors.

Back in August 2018, Third500 partnered SGX to build a pre-IPO and IPO market for "emerging growth" companies that want to access the public markets. Third500 defines "emerging growth" firms as being institutionally-backed with at least US$20 million raised and with trailing annual revenue greater than US$5 million, among other criteria.

Mr Reichenbach is confident that more US firms, particularly in tech, will turn to public markets given the limitations of venture capital. "One (limitation) is that you have to serve the valuation requirements to the new (funding) that's coming in, and that adds valuation pressures. Second ... you will have a governance body (in the firm) consisting of many VCs," he said.

Singapore is, in particular, an attractive listing venue for US firms that wish to access the Asian diaspora, he added.

SGX's collaboration with Third500 could help to "bring US innovation to Asia, especially those with a growth strategy that involves Asian businesses and investors", added Mohamed Nasser Ismail, head of equity capital markets at SGX.