Robinhood. Coinbase. SoFi. Impossible Foods. What do those companies have in common? They were all listed for private investing on Linqto.
Linqto is an investment platform that allows accredited investors to purchase pre-initial public offering (IPO) shares of private companies. By investing before companies are publicly traded, you could get in at an early entry point with a company with great potential. But, there is also a higher level of risk, so make sure you understand the drawbacks before investing your money.
If you think pre-IPO investing might be right for you, you also need to choose the right platform. Learn how Linqto stacks up in this review.
Invest in leading pre-IPO companies
- Invest in leading pre-IPO companies like Ripple Labs, Abra, WHOOP, and more.
- Identify and evaluate the world’s leading unicorns like Coinbase, Robinhood, and others.
- Sign up in less than 10 minutes, 100% online
|Account types available||Personal investment account Connected retirement account|
|Best for...||New accredited investors|
What is Linqto?
A company goes public when it undertakes an initial public offering (IPO) and sells shares to the public.
However, some investors want to invest in these companies sooner. They want to take advantage of pre-IPO investments and buy a stake in companies before shares are available for purchase on a stock exchange. This form of investing, known as private investing, is usually reserved for major investors and investment firms.
Linqto, Inc. aims to change that. Its goal is to make private market investing more accessible. Through its platform, investors can invest in companies pre-IPO.
Linqto was founded in 2010, but its platform was launched in 2020, and the company is based in San Francisco, California. It's headed by CEO and co-founder Bill Sarris, a fintech expert who previously delivered applications for major companies such as Microsoft and Intuit.
Since its launch, it has made more than 200 investments in nearly 40 companies and amassed over $100 million in member investments. Its previous investments include unicorns — privately held startups with valuations of $1 billion or more — and early stage companies such as Ripple and Kraken.
Linqto is broadening its offerings to include novel technologies. For example, investors could get exposure to blockchain-enabled applications by investing in companies such as Abra, or they could invest in companies that create non-fungible tokens (NFTs) and digital collectibles such as Dapper.
Who is Linqto for?
Although Linqto aims to make pre-IPO investing more accessible, not everyone is eligible. To invest through Linqto, you need to be an accredited investor — someone with a net worth of more than $1 million (not including the value of their primary residence) or income of more than $200,000 in the current year and preceding two years ($300,000 for couples).
To invest through Linqto, you must upload documents to verify your income or assets, such as your tax returns or bank statements. If you meet the criteria for accredited investors, Lingto can usually accredit you within 48 hours.
How does Linqto work?
Linqto evaluates privately held companies and chooses which ones to invest in, and it buys pre-IPO shares of companies worth $1 billion or more. Once it owns the shares, it lists the companies on its website. Accredited investors can choose which companies to invest in and how much they want to invest.
You can fund your investment with cash, or you can pay for your investment with cryptocurrency through Linqto’s partnership with Uphold, a digital currency trading platform. You can buy shares on the Linqto website or via the mobile app for Android or iOS devices.
How to get started with Linqto
It’s a relatively quick process to sign up and start investing through Linqto:
- Create an account. To get started, Linqto will prompt you to create an account and answer a few questions about yourself to start the process.
- Upload documentation. After filling out the basic form, Linqto will ask you to upload documents to verify your identity, income, and assets, so plan on submitting a copy of your passport or U.S. driver’s license as well as your tax returns. Once you submit that information, Linqto will review your documents and decide your accredited investor status. In most cases, Linqto can accredit you within 48 hours.
- Invest. Once you receive a notification that you have been accredited, you can begin investing. Linqto’s minimum investment is $10,000. Once you make the investment, Linqto’s team will reach out to you with instructions for funding it. New investors have 10 business days to find their orders and returning investors have five business days. You can make payments through wire transfer, or you can use an Uphold digital wallet. With Uphold, you can pay with U.S. dollars, foreign currencies, and cryptocurrencies.
Pros and cons of Linqto
Should you invest with Linqto? There are some benefits and drawbacks to consider:
- Relatively low investment minimum: With private investments, you often need to invest at least $100,000. But with Linqto, you could invest with as little as $10,000, which makes pre-IPO investing more accessible.
- Deals guaranteed to close: Linqto is not a broker. Instead, the companies listed on its site have already sold Linqto shares, so it transfers that exposure to you when you make your investments. There is no risk of deals falling through; all deals are guaranteed to close.
- Cryptocurrency accepted as payment: If you decide to use the Uphold digital wallet as a funding method, you can fund your investments with cash, foreign currencies, commodities, and cryptocurrencies. This approach could be a good option if you own a significant amount of bitcoin, ether, or other coins.
- Referral program: When you refer friends to Linqto, they could get a $250 reward in Linqto Bucks. If they make an investment, you get $750 Linqto Bucks. Linqto Bucks may be applied toward your future investments.
- Higher level of risk: Investing early in a promising company’s life can be appealing; you could potentially invest and profit as the company grows and goes public. However, pre-IPO investing poses a higher level of risk. The shares you buy are unregistered securities, and so companies aren’t required to file financial documents with the U.S. Securities and Exchange Commission, making it difficult to get reliable information about the companies.
- Less liquidity: Before investing your money, keep in mind that your Linqto investment is not liquid. Investors cannot sell their positions before the company goes public (also known as an exit). According to Linqto, it selects companies that are actively working toward an exit but cannot guarantee they will successfully go public.
- Unclear fees: Although Linqto boasts no brokerage fees, continuing management fees, or carried interest, that doesn’t mean it doesn’t charge any fees at all — it just means its fees are wrapped into your investments. Linqto’s fees are baked into the offer price of each investment on its platform. Although that can be convenient, it also makes it difficult to compare Linqto’s fees to those of other platforms.
- Limited customer support: The only way to contact Linqto’s customer service team is through a secure message sent through its website. It doesn’t offer live chat or phone customer support. Because the minimum investment is $10,000 or more, that lack of availability is surprising and a significant drawback.
Alternatives to Linqto
If you are interested in pre-IPO investing but aren’t sure if Linqto is right for you, consider these alternatives:
Like Linqto, EquityZen allows investors to invest in pre-IPO companies. Larger than Linqto, EquityZen has invested in hundreds of companies. And there are multiple investment options, including single-company funds, multi-company funds, and direct share acquisitions.
EquityZen offers a broader variety of pre-IPO companies currently available for investments than Linqto, but it does have a higher investment minimum. New investors can make their first investment with a reduced minimum of $10,000, but those with between one and five deals have a $20,000 minimum.
EquityZen also charges sales fees. The fee is based on the size of the investment, but the fee ranges from 3% to 5% of the investment amount. For actively managed funds, there are also carried interest or recurring management fees.
Learn more in our EquityZen review.
Robinhood is an easy-to-use trading platform for stocks, mutual funds, exchange-traded funds and cryptocurrencies. Recently, Robinhood also added IPO Access, which gives investors the ability to invest in companies at the IPO price right before the stock trades on the secondary market.
IPO Access isn’t true pre-IPO access, but you don’t have to be an accredited investor to participate and invest.
Find out more in our Robinhood review.
Is Linqto a good investment?
Whether investing in Linqto is good depends on your investment choices and the performance of those investments. Investing pre-IPO is risky and there are no guarantees. Carefully research any companies you’re considering investing in.
What qualifies as an accredited investor?
An accredited investor is someone who meets any of the following requirements:
- Earned more than $200,000 per year in each of the past two years and reasonably expects to earn that much (or more) in the current year
- Together with a spouse or spousal equivalent earned more than $300,000 per year in each of the past two years and reasonably expects to earn that much (or more) in the current year
- Has a net worth more than $1 million either alone or with a spouse or spousal equivalent
- Has a Series 7, 65, or 82 license in good standing.
If you meet the criteria to be an accredited investor, you could use Linqto to invest in promising companies at the pre-IPO stage, diversifying your portfolio and potentially securing shares of high-performing companies early.
However, investing with Linqto — and private equity investing in general — isn’t for beginner investors. You need to meet the requirements for accredited investing to get started, and there is a higher level of risk with private investment opportunities.
If you want to invest through Linqto, learn more about becoming an accredited investor.