We remain bullish on unicorns because these are the technology companies that have achieved product-market fit, and we continue to believe that the technology sector offers the best risk-adjusted returns for growth investors, said Dan Siciliano, Chief Executive Officer and Co-Founder of Nikkl.
SCOTTSDALE, Ariz. (PRWEB) December 07, 2022
Nikkl, a minority business enterprise, today announced the launch of its operating company backed by a $5 million round of funding from a group of private investors, including Heroic Ventures. Nikkl will use this opening round of funding to build its technology platform and launch its investment fund in early 2023. Currently, Nikkl is also raising investment capital to execute on its strategy to provide liquidity to unicorn employees who have vested options. In this way, Nikkl will buy into private unicorn technology companies at today’s much-reduced valuations and address a massive challenge for employees and their employers.
There are 1,201 unicorns worldwide that are cumulatively valued at $3,871 billion. Moreover, despite a general slowdown in venture capital financing, Crunchbase reports that 295 unicorns have reached unicorn status in 2022, and $110.5 billion of financing has flowed into all unicorns this year. Pitchboock also estimates that venture capital firms collectively have $290.1 billion in available funds that have not yet been invested.
“Given today's lower valuations, it’s an opportune moment to invest in unicorns. We remain bullish on unicorns because these are the technology companies that have achieved product-market fit, and we continue to believe that the technology sector offers the best risk-adjusted returns for growth investors,” said Dan Siciliano, Chief Executive Officer and Co-Founder of Nikkl. “Even with recent market volatility, it's a great time to invest if you have a financial product, like ours, that provides access to a diversified portfolio of unicorns and offers downside protection.”
Nikkl provides capital to the employees of select unicorns. Employees use the capital to exercise their vested stock options, and in exchange, Nikkl participates in the equity returns from the shares purchased by employees. Because the initial value of stock purchased by the employee is greater than what the employee owes, Nikkl’s financial product protects the investor’s investment even in the unlikely event that the value of the underlying unicorn shares declines by more than an additional 50 percent off of today’s valuations. At the same time, the unicorn companies receive additional cash through the exercise price and employees benefit because of the tax benefits and near-term liquidity.
“We invested in Nikkl because they have the right approach at the right time with the right team,” said Matt Robinson, Managing Partner and Founder, Heroic Ventures. “Nikkl and its platform offers a low-risk way for investors to take positions in the companies that offer the best prospects for growth while solving a big problem for employees.”
Nikkl is a minority business enterprise company that provides equity financing to the employees of “unicorns,” private tech companies valued at more than $1 billion. Nikkl helps unicorn employees exercise their vested stock options, and in exchange, Nikkl participates in the equity returns generated by the shares. In this way, Nikkl provides investors access to the equity-based returns of nearly any unicorn while also providing investors with downside protection through collateralization. Nikkl’s approach is unique because Nikkl offers the only solution that effectively addresses each of the employee’s needs, such as tax optimization and liquidity. For more information, visit http://www.nikkl.com.