Investing in Private Markets

How do I invest in private markets?

You can follow the steps below to invest in private markets:

App:

1. Navigate to the Private Markets section within Markets.
2. Select Live Offerings then select a company to submit an order.
3. Complete the accredited investor self-attestation to confirm eligibility if applicable.
4. Review and electronically sign all required offering documents before submitting your order.
5. Maintain sufficient settled cash in your account to fund the investment.
6. Once the offering closes and your order is accepted, funds will be deducted from your account, and your investment will be reflected in your brokerage account.

How do I research private companies?

You can research private companies on the Companies page within Private Markets. Here you will find a list of the largest private companies with company valuations, news, and research available to help you learn more about potential investment opportunities.

What are prospective offerings?

Prospective offerings are possible upcoming private company SPV offerings. Here you can enter a non-binding Indication of Interest (IOI) if you are interested in an investment in this private company SPV should it become available. If the offering does become available, you will be notified and can then invest. IOIs are non-binding and help our partner gauge our clients' interest in specific private companies and help guide which private company SPV investments they should make available.

What is an Indication of Interest?

An Indication of Interest (IOI) is a non-binding expression of potential interest in investing in a specific private company. IOIs help gauge investor demand and prioritize sourcing efforts for specific companies. Submitting an IOI signals potential interest but does not obligate investors to invest when an opportunity becomes available. You maintain complete flexibility to evaluate the formal offering and make your final investment decision when a deal goes live.

What happens if I submit an IOI but don't invest?

There are no consequences for submitting an IOI and subsequently deciding not to invest. IOIs are used purely for demand assessment and deal prioritization. Your investment decisions remain entirely at your discretion when formal opportunities become available. However, we would ask that you only submit IOIs for offerings that you are genuinely interested in and likely to make an investment in.

What are live offerings?

Live offerings are available private company SPVs currently on offer. By selecting a specific live offering, you can review offering documents and submit an order. Unlike IOIs, orders are binding and not cancellable. You need to have settled cash in your account in the amount of your order, and funds will be locked up until the offering is closed or cancelled. Once the SPV is fully subscribed, your order will be processed, funds deducted from your account, and your investment will show up in your brokerage account.

What fees are associated with private market instruments?

Private market investments in a private company through SPVs typically involve a brokerage fee on the transaction and an up-front management fee that is charged by the SPV manager. These fees are fully transparent and readily accessed in the offering documents. Brokerage and management fees, along with the underlying company investment, make up the all-in price that investors will pay.

Can I negotiate brokerage fees or management fees?

Brokerage fees and/or management fees are set by the offeror and SPV manager and are not negotiable. The fee structure for each opportunity will be transparently disclosed prior to investment.

Can I sell my SPV position?

Shares held by the SPV are generally considered restricted securities under US securities laws, which typically requires a one-year holding period from the date of purchase before they can be resold. There is no guarantee that a viable, liquid marketplace will be available after one year or that Webull will provide access.

What happens if a company I am investing in goes public?

When a portfolio company completes an IPO, the shares will be moved from the transfer agent to your Webull brokerage account. The shares held by the SPV may be subject to a 180-day lock-up period following the IPO, during which time they will be restricted in your accounts, and they cannot be sold. After the lock-up period expires, your shares will be unrestricted.

What happens if a company I am investing in gets acquired?

Acquisitions of portfolio companies can take different forms, and the outcomes for investors will depend on the specific transaction structure:

• Cash Acquisitions: In an all-cash transaction, the proceeds from the sale of company shares will be distributed to SPV investors in proportion to their ownership percentages according to the terms of the SPV Offering Documents.
• Stock Acquisitions: In transactions where payment is made in acquirer stock, investors may receive shares in the acquiring company in proportion to their SPV interests according to the SPV Offering Documents, or the SPV may be required to hold the shares in the acquiring company until there is a liquidity event for the acquiring entity.
• Mixed Consideration: Many acquisitions involve a combination of cash and stock consideration, in which case investors will receive their proportional share of both components according to the terms of SPV Offering Documents

Whatever the make-up of the final distribution, assets will be available in your Webull brokerage account.

What happens if a company I am Investing in goes bankrupt?

Corporate bankruptcies can result in various outcomes for shareholders, typically determined by the bankruptcy proceedings:

• In Chapter 7 liquidations, company assets are sold and distributed to creditors according to legal priority. Equity investors (including SPV holders) are last in the payment hierarchy and often receive little or no recovery.
• In Chapter 11 reorganizations, the company attempts to restructure its operations and obligations. Existing equity holders may receive some consideration in the reorganized entity, though often significantly diluted.

As an SPV investor, your financial exposure is limited to your initial investment amount. The SPV will represent shareholder interests in bankruptcy proceedings and distribute any recovery value proportionately to investors, though full loss of investment is a possible outcome in bankruptcy scenarios.

When can I expect a liquidity event for my private company investment?

Private company investments should be approached with a long-term perspective, as there is no guaranteed timeline for liquidity events. The path to liquidity depends on numerous factors:

• Company growth trajectory and financial performance
• Market conditions and IPO environment
• Strategic acquisition interest in the sector
• Management and board decisions regarding exit timing

There is substantial variation in the timelines that companies go public or get acquired. While Webull will work to provide investors with a solution for secondary liquidity, there can be no guarantee that the market develops or that Webull will provide access should a secondary market develop. As such, investors should be prepared for the possibility that investments may remain illiquid for extended periods or, in some cases, indefinitely.