Sunday, July 16, 2017

It will take a big "Leap" for people to show their net worth

I am reading the new third board that Bursa is introducing. I feel that not many people would be bothered as it is only open to people of High Net Worth and the definition is as below.

Although the full detail is yet to be unveiled, I can almost be sure that the above which is open to high net worth individuals is there. One can read the full article, on the Star here or below.

Market works best when it is open to the public - not a certain group of individuals. When there is lack of liquidity, there is little market. I know of a certain work (given to and managed by Cradle) that is done to attract high net worth individuals to invest into tech startups and they will get to enjoy tax breaks. That has not done well. Firstly, even in today's age, very few people is going to share their net worth - and moreover these investors will find their investment having little opportunity to be cashed out.

On top of that, if I can invest anywhere in the world, why would I be bothered to let my income and net worth be known. There are enough areas and platforms to invest into if I have the means and knowledge.

The traditional public listing in Bursa, the arranger will charge a high fee for one company to get into the market. In the "Leap" case it will be lower as mentioned below - but I doubt that it will be low either. Startups or SMEs will not be willing to pay anything more than RM500,000 to get their fund raising. This platform is moving towards that kind of fees.

Investment is also a place where there is competition. And I will compete in places where I have a higher chance to win. Leap is not that place.

1 comment:

Multi said...

May be they designed it that way with good intention...high networth people can stomach bigger risk and won't cry when they lost! LOL