AUSTIN, Texas, March 18, 2016 (GLOBE NEWSWIRE) — The NASDAQ Private Market, LLC today released the results of its second annual survey of founders, executives and employees from start-up companies attending the South by Southwest (SXSW) Interactive Festival in Austin, Texas. Nearly half of the respondents believe their companies will remain private indefinitely, representing a 62 percent increase in related sentiment from 2015. For the second year, more than 50 percent say attracting and retaining talent and providing liquidity to their employees are top priorities.
“Our annual SXSW study reveals that start-up company leaders are committed to their entrepreneurial efforts with no immediate plans to pursue the public markets to raise capital,” said Bill Siegel, Head of NASDAQ Private Market. “While it comes as no surprise that start-ups are focused on hiring employees, there remains a gap in how they plan to assist employees with equity-based incentives and compensation as their businesses grow.”
Fifty-one percent of respondents reference liquidity as a key priority, and an overwhelming majority – 80 percent – surveyed say employees should have the opportunity to sell a portion of their shares before an IPO or exit. However, when asked if their companies plan to offer programs that allow employees to sell shares while the company is private, 64 percent indicate their companies are unsure or do not have definitive plans.
Additional findings from the survey include:
- Company Profile: 47 percent represent companies ten years and older; the leading sectors represented by our survey respondents come from technology/software (25%) and financial (25%).
- Increased Company Loyalty: demonstrating strong company commitment, nearly 30 percent said they envision remaining at their current start-up for ten years or more, a 61 percent increase in related sentiment from 2015.
- Funds Raised: respondents representing companies with over $50 million raised increased 83 percent, but the largest portion of respondents were from companies who raised $2 million or less (34%), consistent with our 2015 survey.
- Preference for Institutional Sponsors: for the second year, over 60 percent prefer funding from venture capital or private equity sponsors vs. crowdfunding (5%), angels (25%) or government-sponsored programs (3%).
To view the full survey results, please visit: http://spr.ly/NPMSurveyResults
The NASDAQ Private Market survey was conducted on March 13, 2016, at the SXSW Interactive Festival in Austin, Texas. One hundred and twenty six event attendees were polled for this survey, including executives and employees of private companies. Forty-five percent of respondents are company founders or hold C-Suite level positions.
About NASDAQ Private Market
The NASDAQ Private Market, LLC is the premier equity services provider to private companies. Our end-to-end solution enables private companies to digitize, integrate, and control all of their equity-related functions, including cap table management, shareholder liquidity, investor relations, and capital raising. Whether a company seeks to optimize an eventual IPO or remain private permanently, NASDAQ Private Market provides comprehensive capital market support to meet its needs. For certain eligible investors and shareholders, NASDAQ Private Market is a place to discover and engage with some of the most exciting private companies. The information contained herein is provided for informational and educational purposes only. None of the information provided is an offer or solicitation to buy or sell any securities, or to provide any legal, tax, investment or financial advice. The NASDAQ Private Market, LLC is not: (a) a registered exchange under the securities exchange act of 1934; (b) a registered investment adviser under the Investment Advisers Act of 1940; or (c) a financial or tax planner, and does not offer legal advice to any user of the NASDAQ Private Market website. Securities-related services offered through SecondMarket are provided by SMTX, LLC, a registered broker-dealer, which is a member FINRA/SIPC and a wholly-owned subsidiary of The NASDAQ Private Market, LLC. Securities-related services offered through The NASDAQ Private Market, LLC are provided by NPM Securities, LLC, a registered broker-dealer, which is a member FINRA/SIPC and a wholly-owned subsidiary of The NASDAQ Private Market, LLC. Securities offered through SMTX, LLC and NPM Securities, LLC are not listed or traded on The NASDAQ Stock Market LLC, nor are the securities subject to the same listing or qualification standards applicable to securities listed or traded on The NASDAQ Stock Market LLC. Data collected from the SecondMarket platform may include transactions conducted through current and former affiliates of SecondMarket. To learn more, visit www.npm.com.
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