Buy pre-IPO stock in private companies
Invest in private credit deals
Investments
$10,000
The minimum investment on EquityZen is $10,000, though this may vary by offering.
Investments
$500
Investors can enter the private credit market via Percent with a minimum of $500, accessing a variety of asset-based securities and corporate loans.
High Risk
4/5
Investing in private companies via EquityZen involves risks such as limited liquidity, market volatility, company performance uncertainties, regulatory changes, less available information, and potential lack of diversification, which could impact investment returns.
Moderate Risk
3/5
Investing on Percent comes with inherent risks, despite efforts to minimize these through a proprietary risk framework for its own deals. The risk levels can vary across the platform, depending on whether Percent or a third party underwrites the deal.
Minimum Liquidity
1/5
EquityZen offers liquidity for vested shares only. It does not provide liquidity for unvested shares, unvested RSUs, or options directly.
Minimum Liquidity
1/5
Liquidity on Percent, as with many private credit platforms, varies by investment. Generally, these investments are less liquid than public stocks, tied to longer-term commitments without guaranteed immediate access to funds.
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Not Predictable Return
N/P
Unlike public market investments, private investments carry higher risks and unpredictability. Consequently, it's challenging to define a standard return rate for EquityZen investments.
Moderate Return
13.41 %
As of February 1, 2024, Percent offers a 2.5% interest rate on idle cash in accounts and reports a historical weighted average APY of 13.41% on investments.
Long-term Investment
2-5 years
Typically, companies on EquityZen have received late-stage funding, suggesting an expected investment horizon of 2-5 years, but outcomes can vary widely.
Short-term Investment
3+ months
Percent offers investment horizons starting at 3 months, accommodating short-term investment strategies.
Who can invest
United States
Percent accepts investments only from accredited investors in the U.S. with U.S. bank accounts, adhering to Reg D 506(c) exemption rules.
Moderate Volatility
3/5
Assets on EquityZen, which are shares in private companies, can be highly volatile due to limited public information, sensitivity to market conditions, low liquidity, and company-specific events, leading to significant price fluctuations.
Moderate Volatility
3/5
Assets on Percent generally show lower volatility than public market investments due to the nature of private credit, which often involves fixed returns from contractual agreements.
Regulation and audits
SEC Regulated
EquityZen Securities is registered with the SEC and is a member of FINRA/SIPC, ensuring it adheres to regulatory standards and practices for investor protection and undergoes regular audits.
Regulation and audits
SEC Regulated
Percent is regulated under Regulation D, 506(c) of the Securities Act, allowing only accredited investors to participate after verifying their status.
Insurance
No
EquityZen is a FINRA/SIPC member firm, offering account protection up to $500,000 (including $250,000 for cash claims) through SIPC in case of brokerage failure, not covering market value losses.
Insurance
Yes
Funds deposited with Percent are held at an FDIC-insured bank, ensuring protection up to $250,000, the maximum allowed by law, providing security for investors' capital in case of a bank failure.
Payouts
No Recurring Payouts
Investors in private companies on EquityZen typically do not receive dividends, as these companies often reinvest profits to fuel growth.
Payouts
No Recurring Payouts
Percent provides returns through interest payments or fixed returns from private credit deals, rather than traditional dividends.
Withdrawals
Investors can get their money back from investments on EquityZen mainly through an IPO, acquisition of the company, or secondary market sales on the platform. However, returns depend on market demand and timing of these liquidity events, with no guaranteed timeline.
Withdrawals
Upon investment maturity on Percent, funds (principal and yield) are credited to the investor's account. Investors can then transfer these funds to an external account or reinvest.
Extra Fees
Yes
EquityZen charges a 5% fee to sellers upon transaction closure. For investors, a one-time sales fee applies: 5% for investments up to $500,000, 4% for $500,000 to $1 million, and 3% for over $1 million.
Extra Fees
Yes
From September 2023, Percent charges a fee of 10% on interest payments, not affecting the principal.
Taxes
Tax Form
EquityZen issues a Schedule K-1 for taxable events and provides vetted tax documentation to investors. Upon investment, individuals complete necessary tax forms (W-9 or W8-BEN) and receive annual tax updates.
Taxes
Tax Form
Percent provides investors with a consolidated 1099-INT form each tax year, reporting all investment income as ordinary income for tax purposes.