Jeff Stewart, global entrepreneur, is a successful technology start up CEO who has teamed up with Stewart Nutting, former UBS Investment Bank Managing Director, to expand technology IPOs on the ASX, the Australian Stock Exchange (ASX:ASX).
The basis for the partnership with ASX is their fund of high growth global technology businesses: “The fund was created because we saw the U.S. IPO market is broken for small tech companies, where it no longer functioned for companies in the sub-$2 billion range. Meanwhile, we saw that the capital markets in Asia Pacific are functioning for IPOs. The basic observation was that U.S. tech companies would be more valuable and have more financial flexibility and credibility by listing in Asia Pacific, in what we call a global IPO, where you’re a founder-led U.S. company, you’re listed in Asia Pacific, and you get a public investor base from around the world so that you are positioned for growth.”
Mr. Nutting further details the strategy in this exclusive interview with the Wall Street Transcript. “In Australia, which is the ninth-largest share market in the world, 60% of the market structure are financially sensitive, and it’s heavy with economically cyclical global mining companies. The tech sector is very, very underrepresented as a percentage. Australia has a compulsory superannuation savings system like a 401(k) with $2 trillion of assets under management, growing at approximately 10% from government-mandated cash flows, and savers in the region do not have access to technology investments.”
This combination of an extremely high savings rate, not only in Australia but the region as a whole, and the scarcity of high growth tech companies, creates a large scale capital formation opportunity in the highly regulated and transparent ASX. The two global entrepreneurs are taking advantage of this immense arbitrage by matching the two parties.
“The companies we invest in will go public within 12 to 18 months. The portfolio will have between 20 and 25 companies that will be listed, but in the beginning, they will be privately held companies, private U.S. companies in that $100 million to $200 million private market valuation range of technology-enabled businesses. ”
For detail on the companies being selected for the fund, read the entire interview with successful global entrepreneur Jeff Stewart and his colleague Stuart Nutting here at the Wall Street Transcript.
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