'Venture capital is broken': Scalare pitches backdoor IPO as VCs question model
Scalare Partners' ambitious plan to open up tech deals to a broader set of investors via a backdoor IPO is being privately questioned by venture capital investors.
Venture capital is broken, according to Scalare Partners CEO Carolyn Breeze, and she has a proposal to fix it.
Scalare is set to enter the ASX through a reverse listing of a defunct confectionery company, becoming Australia’s first publicly listed early-stage tech accelerator. It plans to raise between $4 million and $8 million by issuing shares at $0.25 each, valuing the company at $26.5 million.
"I think that people don't have the opportunity to invest in early tech and access it via the VC model, because there are barriers to investing, and it locks away your money for five to 10 years until there's liquidity events," says Breeze. "We want to break the mould. We think it's outdated for tech scale-ups and startups, and we want to make it available and accessible to all sorts of investors, like retail investors."
Scalare has already invested in 27 companies across six countries, with a current portfolio valued at $10.23 million. However, the company’s financial performance raises questions for one hoping to list on public markets. For FY2024, Scalare recorded a pro forma after-tax loss of $350,989.
