Fintech Company Arcton Wants to Launch Startup IPOs

The future of startup investing belongs to the crowd, say the founders of Arcton, and they are preparing the ground for startup IPOs.

As is well known, VC firms and professional investors have tended to put on the brakes since the turnaround in interest rates and remain reluctant to provide fresh capital. Investments in fintech companies and other techs are currently nowhere near the euphoric highs and fantasy-driven peaks of earlier years.

Merens Derungs and Francesco Biviano, founders of fintech company Arcton, make a virtue out of necessity, stating, “Startup investment has historically only been available to the richest three percent of the population. It’s time to democratize this asset class. The future of startup investing belongs to the crowd.”

The idea is not entirely new; crowdinvesting has been invented, and the number of platforms that offer small investors access to startups has grown rapidly in recent years. This opinion is apparently also shared by the creators at Arcton, which is why they recently published the first Startup Investor Map.

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Startup Investor Map

The Investor Map is a visual representation of 116 organizations that open access to startups for investors in different ways. Why this map?

What stands out, according to Arcton, is the strong growth of crowdinvesting, where individuals can invest in startups with small amounts. Despite this dynamic development, the number of Swiss platforms remains manageable, the founders find. Therefore, leading international platforms were also included in the map.

Nevertheless, Arcton focuses on Swiss investors and Swiss startups – with the consideration that Switzerland produces extremely successful startups, but Swiss investors still rely on foreign startups for the majority of their commitments, much to the chagrin of the local startup scenes.

With the “Swiss Startup Investor Map”, Arcton wants to show investors concisely how they can invest in local startups. Whether the map can create effective incentives remains to be seen – at least the map provides an overview of who is in the game and connected to startups in the area of startup capital. The map in high resolution can be downloaded for free at Arcton.

Things get more concrete with a public marketplace for startup investments

According to its own statements, the Zurich-based FinTech is building the first public marketplace for startup investments. The platform developed by Arcton creates the environment to invest in startups with small amounts. Up to this point, it is comparable to the services of existing crowdinvesting platforms.

However, Arcton claims one major difference: what’s new, say the founders, is that investors can trade their shares around the clock once the campaign is over, much like listed stocks. This approach is said to be fundamentally different from existing startup funding, where investors are often locked into their shares for up to ten years. In addition, according to Arcton’s founders, secondary markets simply do not exist in other crowdinvestings.

To ensure that shares can be traded at any time, Arcton relies on a partnership with the decentralized stock exchange Camelot.

Into the next round with startup IPOs

The fintech company also differentiates itself in the description of the services it offers. It doesn’t call itself a crowdinvesting platform, but a marketplace for startup investments with startup IPOs.

The first startup IPO (initial public offering) with tokenized shares is scheduled to launch before the end of October. The IPO candidate to debut is Geneva-based Money Masters, a company that aims to democratize financial literacy. Immediately after the IPO, investors will be able to trade their Money Masters shares in real-time via Camelot. In anticipation of the startup’s IPO, Arcton is hosting an IPO roadshow across Switzerland, with the finale in Zurich.

Fresh capital for the Arcton

In order to be able to financially tackle the upcoming challenges, Arcton raised 350,000 Swiss francs in a pre-seed financing round in September. With the fresh capital, the FinTech wants to pave the way for “a new type of startup investment: Startup IPOs.”

Those who do not want to draw the dividing line between crowdinvesting and startup IPOs too sharply now can be surprised by the first upcoming startup IPO. Or, our editors’ view: what name the various financing vehicles go by is not really essential. What is important is that they exist to interest investors in promising startups.

The economy needs new ideas and impetus. The impulse providers, success-hungry startups, need capital and thus accessible and walkable financing channels so that their ideas can develop into strong business models. Every additional platform that brings startups and investors together is a win for the economy and for the startup scene. And, if things go well, for investors as well.

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(Featured image by Markus Winkler via Unsplash)

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First published in MoneyToday.ch. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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