A "blank cheque" venture capital company is using share capital to invest in private tech firms. Social Capital Hedosophia Holdings, which raised $10m for its recent IPO, plans to use the raised funding to invest in tech start-ups. The investments will grant the start-ups some of the benefits of being a public company, like access to capital, without having to go through the IPO process themselves. It also means portfolio companies will not have to meet financial expectation of short-term orientated shareholders. Social Capital's backers include Tony Bates, former CEO of Skype, and Adam Bain, former COO of Twitter.
A "blank cheque" venture capital company is using share capital to invest in private tech firms. Social Capital Hedosophia Holdings, which raised $600m for its recent IPO, plans to use the raised funding to invest in tech start-ups. The investments will grant the start-ups some of the benefits of being a public company, like access to capital, without having to go through the IPO process themselves. It also means portfolio companies will not have to meet financial expectation of short-term orientated shareholders. Social Capital's backers include Tony Bates, former CEO of Skype, and Adam Bain, former COO of Twitter.